Lockdowns and largesse to spark IG supply as pricing poses puzzle

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By Mike Turner
29 Oct 2020

Fresh national lockdowns across Europe and further ECB stimulus are tipped to lead to a surge in high grade corporate bond issuance in early November. But the central bank’s bond buying has turned finding fair value into a convoluted process and this will likely only become more difficult after it hinted on Thursday at doing even more in December.

Germany and France this week announced new national lockdowns to slow the spread of the coronavirus, sending equity markets tumbling and credit spreads to wides not seen since the summer — the Europe Main index hit 65bp on Wednesday. 

London-based bond syndicate bankers expect similar lockdowns in the UK ...

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