Rabobank: Greek Upgrade At DBRS Unlikely To Impact

Rabobank also play down the prospect of meaningful GGB tightening based on IG attainment at DBRS. They note the following points:

• “This move will serve to validate rather than trigger speculation Greece is on a path toward regaining its investment grade status (the fact that 10y GGBs trade comfortably through investment-grade BTPs argues this already fully in the price if not more so).”
• “DBRS ratings are not used to determine benchmark index inclusion.”
• “Third, while the ECB has looked to DBRS when judging collateral eligibility (this owing to the agency’s characteristically more optimistic stance), GGBs are already subject to a waiver in terms of Eurosystem credit quality criteria and are set to continue to do so until end 2024.”