Bonds open lower on profit-taking

German Bund futures opened lower on Monday as investors booked profits after last week's record highs and turned wary ahead of euro zone Purchasing Managers' Index data and Belgian debt supply this session. But Bund futures were well supported after rallying on Friday to an all-time peak for a third successive session as appetite for safer haven assets remained strong given a deteriorating global economic backdrop.
Euro zone flash composite PMI for August is forecast to be 56.4. A figure above 50.0 indicates economic expansion.
"Bunds will dig themselves out of any setbacks early on. Profit-taking is what Bunds face for downside risk. Even bullish data will not upset those who see the global economy as essentially slowing," a trader in London said. At 0606 GMT, the September Bund future was down 20 ticks at 132.69. last week it peaked at 133.02. The two-year Schatz yield was up 1.8 basis points at 0.633%.
Ten-year Belgian OLO spreads over German Bunds widened on Friday to 72 basis points from 65 bps midweek, as investors began to cheapen off debt ahead of up to 2.8 bln euros of Belgian 2013, 2020 and 2022 maturity debt supply this session.