Core markets soften on agency switches

Though there has been a perceptible change in French covered bond flows in the last couple of days following a tightening in the spread to government bonds, market trading remains stable. Flows are broadly balanced, though there are slightly better sellers in core markets. DexMA is marginally better bid in the wake of Thursday morning’s announcement on Dexia’s restructuring and cédulas are unchanged after Moody’s downgrades.