Surge in EGB Issuance May Result in Lower 2H20 Supply

January is typically a very busy month for European sovereign issuance as national treasuries kick off their annual funding programmes. This year has seen a marked uptick in supply relative to the previous year as issuers have taken advantage of low borrowing costs to...

Outlook stable for Europe and UK consumer

With global trade headwinds intensifying and many governments still reluctant to turn on the spending taps (for now), the burden of growth remains with the consumer. In the eurozone, consumer conditions appear relatively mixed. There is a divergence between soft and...

Early Indicators of SNB Intervention

We previously highlighted the significance of the 1.10 level for EURCHF – a level which would likely trigger intervention from the SNB. The central bank has previously sought to weaken the franc when EURCHF has been below this level and, despite an arguably weaker...

Early Signs of Greek Rebound

Another new era dawns for Greece after voters rejected the incumbent hard left Syrzia government at the July 7 general election and voted in the centre-right New Democracy. The economy also, finally, appears to be turning a corner. The Greek treasury tapped a 10-year...

Norges Bank running out of tightening room

At a time when market expectations of G10 monetary policy are rapidly shifting in the direction of fresh policy easing, Norway is a clear outlier. The Norges Bank hiked the deposit rate by 25bps last week and has alluded to the possibility of further hikes going...

Market Pricing Restart of ECB QE

The apparent de-anchoring of market-based inflation expectations has started to rattle the ECB and has raised the spectre of a return to monetary easing, mirroring the abrupt shift in marketimplied policy rate expectations in the US where 65 bps of cuts are now...

Negative-yielding debt suggests overextension

Over the last nine months the outstanding amount of government bonds worldwide with negative yield has increased by $5.4trn to $11.7trn (using the latest daily estimate), homing in on the $12.2trn record set in June 2016. The majority is accounted for by Japan,...

Setback to Turkish Recovery

Having appeared to have passed the worst of the economic crisis, Turkey has faced a fresh bout of turbulence in recent weeks. We have revisited our framework for identifying buying opportunities following an EM crisis to gauge Turkey’s position on the recovery path....

TLTROs are no Silver Bullet to Eurozone Problems

The ECB’s latest announced form of stimulus is a third round of TLTRO issuance. Previous tranches of TLTROs have been 4-year loans primarily made to European banks that are active in lending to the private sector. The rate paid on the loans is reduced as more of the...