HALISTER1: EGBs Close Steady, OATs Outperform; End-of-Day Curves, Spreads

EGBs Close Steady, OATs Outperform; End-of-Day Curves, Spreads

(Bloomberg) -- Core bonds were little changed heading into the close; initially rallied after Draghi comments, downplaying likelihood of guidance change, then came under pressure into large duration Spain and OAT supply.
  • Spanish bonds struggled heading into the auction as concession built in the long-end, with fast money seen setting up for supply, said one trader in London
  • OATs were met with follow-through buying from domestic real money following the auction in the 15y sector, according to one trader, a spot which these investors have previously favored, according to BNP. French bonds outperformed core by around 2bps across the curve, while 10s15s30s fly richened around 1bp
    • There is strong seasonality in OAT/Bund spread which has consistently tightened in April, owning to large redemptions, which has been widely flagged
  • Click here for a spreadsheet heat map of euro-area govt bond curves and spreads

Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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