Halister News

(Bloomberg) -- In EUR rates, 2y and 10y+ maturities are exposed to a bearish repricing relative to the belly, while the opposite is true in USD rates, Societe Generale strategist Adam Kurpiel writes in client note.

• Receive EUR 2s5s30s vs pay USD 2s5s30s; target -70bp, stop -32bp
• EUR short rates have still some room to move up as ECB rate cut expectations are re-priced down
• ECB will announce tweaks to PSPP rules, which should favor a steepening of the 5-30y segment
• Belly of the EUR curve remains supported by the ECB’s forward guidance on rates and TLTROs II
• Potential for an upward Fed re-pricing exposes the USD belly vs the wings