Secondary spreads in the euro public sector market have widened heavily across the curve with just over a month to go before the European Central Bank is expected to put an end to its Public Sector Purchase Programme. SSAs are also being affected by the political ructions from Italy, Brexit and the global trade war, said bankers.
“There’s a general widening trend across the euro SSA curve,” said an SSA syndicate banker. “From the European Stability Mechanism to the European Investment Bank, they’re all under pressure.”
ESM’s €2bn May 2033, which was sold at mid-swaps minus 16bpin May, was quoted by bankers at minus