Risk-off movements concentrated in front end, say bankers
European banks’ curves are steepening up to three years and flattening beyond that point, suggesting investors are concerned about the short term stability of the continent’s banking sector but more confident about the long term, bankers told EuroWeek on Tuesday.
The Markit iTraxx senior financials index was 10bp tighter by midday London time, at 289bp. Bankers said cash bonds had been slow to react to the tightening, although they said this was natural and reflected the way that the cash market had remained stable throughout last weeks widening.
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