Italy flavour of the week despite softer backdrop

Italian issuers have come to the fore this week, with UniCredit bringing the first peripheral tier two deal for over a year and UBI Banca finding demand further down the credit curve in senior unsecured. While such demand exists, the asset class is expected to take precedence over covered bonds, where supply is expected to remain subdued for a while in spite of bankers encouraging peripheral names to tap the market.