LONDON (MNI) - European credit markets have seen a mildly soft session with spreads edging wider in places. The notable underperformer again today in the financial sector, where medium and high grade single names continue to see sharp widening in places, mirroring, to a degree, weakness seen in European government bond spreads today, where Greece, Portugal and Ireland widened.

LONDON, Sep 8 (MNI) - M&A-linked sterling demand into early Europe provided the main drive as the pound made general gains, cable pushing up to a high of $1.5495, while euro-sterling was able to extend its corrective pullback from Monday highs of stg0.8390 to stg0.8202.

Release of stronger-than-forecast Halifax house price data and UK industrial production/manufacturing output coming in at expected levels, also aided sterling's recovery. The pound held off best levels ahead of the NY open, though the underlying tone remains buoyant.

FRANKFURT (MNI) - Germany sold E1.981 billion in inflation-linked bonds ("linkers") in a top up of its 1.50%-coupon 10-year linker with 2016 maturity at a real average yield of 0.19%, the Bundesbank announced Wednesday.

The bid/cover ratio (excluding retention) was 1.9, above the 1.8 b/c at this security's last auction on June 11, 2008.

The lowest accepted price was 107.19, while the average weighted price was 107.26. The government accepted 75% of the bids at the lowest accepted price.

LONDON, Sep 8 (MNI) - Despite the negative tone in European credit and equity markets so far today, the expected rush of new issues has begun to materialise, with a number of benchmark deals to add to the pipeline this morning.

Swedish Housing Finance Corp is to issue a benchmark, 3 year FRN deal in Euros. Price talk is in the Euribor plus high-60s area and the leads are Barclays, Deutsche Bank and JPMorgan.

RBS is to issue a benchmark, 2 year FRN deal in Euros. Price talk is in the Euribor plus 145-150 bps area and the deal is to be self-led.

LONDON, Sep 8 (MNI) - Despite the negative tone in European credit and equity markets so far today, the expected rush of new issues has begun to materialise, with a number of benchmark deals to add to the pipeline this morning.

Swedish Housing Finance Corp is to issue a benchmark, 3 year FRN deal in Euros. Price talk is in the Euribor plus high-60s area and the leads are Barclays, Deutsche Bank and JPMorgan.

RBS is to issue a benchmark, 2 year FRN deal in Euros. Price talk is in the Euribor plus 145-150 bps area and the deal is to be self-led.

BEIJING (MNI) - The People's Bank of China announced that it will sell CNY17 billion in three month bills on Thursday as part of its open market operations.

The PBOC will also sell CNY100 billion in three-year note on Thursday.

People's Bank of China open market operations:

For Week 3M 3M 1Y 1Y 3Y 3Y Net Starting: volume yield volume yield volume coupon Position CNY bln pct CNY bln pct CNY bln pct CNY bln

LONDON (MNI) - The Bank of England said Wednesday it received no bids at its latest 7-day unlimited dollar repo operation.

The dollar repo operations were reintroduced by the Bank of England as part of a co-ordinated move by G7 central banks to inject dollar funds into the money markets if needed.

FRANKFURT (MNI) - The European Central Bank said Wednesday that it has allotted $60 million in its 7-day USD liquidity providing operation.

The central bank said it received 1 bids. The minimum bid amount is $5 million.

The operation was carried out at a fixed rate of 1.18%. The Euro/USD rate was set at 1.2727.