Brexit deal to send UK covered bonds tighter

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By Bill Thornhill
23 Nov 2020

As the UK approaches the end of its Brexit transition period there are growing expectations that a trade deal will be struck with the EU. It is hoped that that will contribute to the factors driving spreads tighter on UK covered bonds.

Traders saw investors buying UK covered bonds on Monday as they still looked cheap relative to those from other countries.

For example, five year Santander UK euro bonds were trading at 13bp-14bp over mid-swaps, which is wider than Australian and Canadian covered bonds, while UK building society ...

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