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Flat Start For Spreads To Bunds

EGBS

EGB spreads vs. Bunds are essentially unchanged on the day.

  • A recovery from yesterday’s lows in European equity index futures and upcoming German supply helps Bunds away from Asia-Pac highs.
  • BTP-Bunds sticks within the 135-140bp range seen since this time last week, while OAT-Bunds holds within the 70-75bp range that has prevailed over the last 2 weeks.
  • EUR 3M10Y vol. continues to operate above July cycle lows (~72 vs. ~68) but has pulled back from the early August risk-off highs (~80bp).
  • Zooming out, the move back towards cycle lows in vol., stabilisation in equities and upside risks to German debt issuance have all factored into the move off the early August wides in EGB spreads vs. Bunds.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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