Analysts at Barclays are sticking with their...>

EGBS: Analysts at Barclays are sticking with their short BTP, long Bonos trade

despite its recently good performance. 

- The Catalan election did not produce a landslide victory for the independence

party. "In our view, this, together with confirmation of a general election date

in Italy for 4 March, sees relative political risks increasing in Italy versus

Spain".

- Barclays also point to a supply advantage for Spanish debt over Italian,

"Allowing for coupons, redemptions and ECB purchases, net cash from Italy will

be slightly positive but, in contrast, notably negative from Spain, with the

country difference being close to E10bn. EGB spreads remain on the tight side,

hence, we see room for further relative underperformance of Italy from here."