Rates markets start to rock from pricing pushback

By Bill Thornhill, Lewis McLellan
18 Jan 2018

It’s hard to fault the support the euro market has offered rates borrowers in the past week. Executions have been smooth, books well-filled and new issue premiums skinny. But, with ever more hawkish signals from the European Central Bank and steepening yield curves, the future does not look so rosy for borrowers. The balance of pricing power seems likely to shift in favour of investors.

“Investors are talking their own book,” said an SSA syndicate official. “They’re playing the fact that the ECB will stop buying and it means they have a stronger hand than they did this time last year.”

The ECB’s Estonian representative Ardo Hansson said on Monday that he believed ...

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