KfW stands firm amid peripheral rout

Fitch's downgrade of Spain on Friday and the woes of the country’s banks triggered another peripheral sovereign rout this week. All the peripheral eurozone sovereigns widened to pre-bail out levels, putting paid to the plans of those issuers who were looking to follow Nederlandse Waterschapsbank, which issued last week. In all the volatility, a couple of planned dollar deals also appear to have been put on hold — Council of Europe and Swedish Export Credit Corp., for example, had hoped to issue this week. The only issuer brave enough to launch is KfW with a $1bn RegS four year led by Deutsche Bank and Morgan Stanley. Pricing will be in the mid-swaps plus 20bp area. The Province of Ontario is also thought to be contemplating issuance this week. Read EuroWeek on Friday for the market's views of where we go from here