J.P.Morgan Client Survey Flags A Pullback In EGB Tightening Bets

J.P.Morgan's latest European client survey notes that "while single- and multi-currency European real money investors' positioning in EGBs is at multi-year longs, they cut back some of their bullish intra-EMU tightening exposure. Investors remain small short gilts and small long USTs.

• Multi-currency European real money investors in EGBs remain long (+ 0.18 years). Their current exposure is at the longer end of the range since the end of 2015.
• Single-currency European real money investors in EGBs added to their longs (from +0.48 years to +0.52 years). Their current exposure is at the longer end of the range over the past decade.
• Investors reduced their intra-EMU tightening exposure since the last survey (from 68% net long to 49% net long), from the most bullish since mid-2015.
• European multi-currency investors in USD remain modestly long (from +0.06 years to +0.05 years), as are US domestic investors (9% net long).
• In the UK, single-currency investors in GBP remain small short (from -0.06 years to -0.05 years). UK real money investors have typically been short or neutral GBP duration over the past few years."
• N.B. The "years" metric represents duration deviation from the respective benchmarks in years.