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Danske Do Not Expect Much Election Feedthrough Into PGBs, Eying Moody's Update On Spain

EGBS

Danske Bank do not expect the Portuguese election result to “have much market impact after the recent ratings upgrade.”

  • “Portugal now has three single-A ratings and will be included in more sovereign bond indices as well as fulfilling the rating requirement for more collateral baskets such as Eurex ECB basket.”
  • “This should be positive for PGBs but also other peripherals next in line for an upgrade.”
  • “Spain is up for review at Moody's on Friday.”
  • “If Spain is upgraded, then SPGBs will also be included in more bond indices as well as fulfilling the rating requirement for the collateral baskets.”
  • “The first indication on the potential demand for PGBs can be seen this week as the Portuguese Debt Office will tap up to EUR 1.25bn of PGBs.”
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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