Free Trial

EGBs-GILTS CASH CLOSE: Bunds Cheapen Vs Swaps On High TLTRO Repayments

BONDS

European yields rose continuously for most of Friday's session, with core FI erasing most of the week's rally.

  • The German curve weakened in parallel, while the UK curve was mixed.
  • ECB TLTRO repayments came in higher than expected at E447.5bln
  • Asset swap spreads tightened as German yields rose, with collateral seen coming back to market, thereby easing shortages.
  • The biggest single move of the day, though, came after US producer price data came in higher than expected - 10Y Bund and Gilt yields rose over 4bp.
  • Attention turns to next week's heavy central bank schedule, with decisions among others by the ECB, BoE, and Federal Reserve.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

  • Germany: The 2-Yr yield is up 9.1bps at 2.16%, 5-Yr is up 11bps at 1.943%, 10-Yr is up 11.3bps at 1.933%, and 30-Yr is up 10.7bps at 1.746%.
  • UK: The 2-Yr yield is up 8.8bps at 3.426%, 5-Yr is up 5.2bps at 3.254%, 10-Yr is up 9.2bps at 3.181%, and 30-Yr is up 5.5bps at 3.57%.
  • Italian BTP spread up 3.1bps at 190.6bps / Spanish up 1.9bps at 102.4bps

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.