LONDON: German government bond futures opened lower on Monday, under pressure in thin trading after a report of a potential framework for the European Central Bank's scheme to buy the bonds of troubled euro zone countries.
UK markets were closed for a holiday, meaning trading volumes were set to be even lower than in recent summer weeks.
September Bund futures were 19 ticks lower at 143.81 after rallying to their biggest weekly gains since early July last week.
But the contract was slightly up from levels seen in after-hours trading on Friday when Bunds were knocked lower by a Reuters report, citing central bank sources, saying the ECB is considering setting yield band targets under its proposed bond buying programme.
"Given that questions (over Greece's fate...and the delivery of sovereign liquidity support) are likely to be addressed only later, that should result in fairly sideways action in yield levels and spreads," Credit Agricole strategists said in a note.
Prices have been volatile in recent weeks as market players wait for details on what the ECB's proposal to buy bonds of troubled euro zone countries may look like, while risks of a Greek euro zone exit have bubbled back to the surface in recent days.
Italian bonds are expected to come under pressure ahead of debt sales on Tuesday and Thursday as dealers make way for the new issuance on their books.
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