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BONDS: 10-Year Gilt/Bund Spread Below 200bp, To Levels Not Seen Since Oct

BONDS

Last night’s proposed German fiscal loosening continues to promote Bund underperformance vs. peers.

  • The presence of the 30-Year German bond syndication adds further pressure to spreads.
  • The 10-Year spread to UK paper is through the October 30 closing level (196.4bp), with clustered support seen just below at the Oct 25 close & 50% retracement of the July ’24 to Dec ’24 widening (194.2bp/194.1bp).

Fig. 1: 10-Year Gilt/Bund Spread (bp)

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Last night’s proposed German fiscal loosening continues to promote Bund underperformance vs. peers.

  • The presence of the 30-Year German bond syndication adds further pressure to spreads.
  • The 10-Year spread to UK paper is through the October 30 closing level (196.4bp), with clustered support seen just below at the Oct 25 close & 50% retracement of the July ’24 to Dec ’24 widening (194.2bp/194.1bp).

Fig. 1: 10-Year Gilt/Bund Spread (bp)

Keep reading...Show less