1.   Bonds relinquished earlier gains won after the Bundesbank cut its securities repurchase rate, bolstering hopes the German central bank will cut its discount rate Thursday.

2.   Economists and investors said the Bundesbank kept rate cut speculation alive by leaving room for its key money market rate, the securities repurchase rate, to fall.

3.   German government bonds rose as forecasts of slowing growth and a cut in the securities repurchase rate lifted hopes for another cut in the floor discount rate.

4.   Germany is expected to cut its chief money market rate, the securities repurchase rate, during the first half.

5.   However, all but four expect the Bundesbank to reduce its chief money market rate, the securities repurchase rate, eventually.

6.   In Germany, the central bank will decide later today whether to raise the securities repurchase rate.

7.   Issing declined comment on whether the Bundesbank will stick with a variable securities repurchase, or repo, rate, its target interbank lending rate.

8.   Looking ahead, the Bundesbank is likely to again lower its securities repurchase rate when the central bank allots its weekly round of commercial bank credits tomorrow.

9.   Merrill Lynch economist Darren Williams said he expects the central bank will continue to lower call money in the coming weeks before cutting the securities repurchase rate again.

10.   Optimism the German central bank will lower its chief money-market rate, the securities repurchase rate, later this quarter also drove bunds higher, analysts said.