Peripherals Little Changed Vs. Bunds To Start, Familiar Discussions Dominate

Little net movement in peripheral spreads vs. Bunds thus far, flat to 0.5bp tighter on the day at the 10-Year point.

• Moody’s moved Spain’s Outlook to positive on Friday but left their rating unchanged at Baa1.
• Spain’s rating at Moody’s remains one notch below S&P, who affirmed their A; Outlook stable rating on Friday, and Fitch. This explains the lack of early Monday SPGB tailwinds following the Moody’s outlook change.
• ECB speak didn’t move the needle over the weekend, with focus remaining on June re: the timing of the first cut (~21bp of easing priced through June at present).
• Broader discussions surrounding peripherals continue to be split, with some calling time on the tightening owing to the degree of the move seen.
• Meanwhile those looking for further tightening point to carry, positive fundamentals surrounding PGBs & GGBs in particular, expectations for ECB easing, technical breaks and momentum.