Austrian Sovereign

The European Investment Bank and Republic of Austria are considering dollars deals this week, SSA Markets understands. The deals will test demand for more expensive names in dollars, after blow-outs from a pair of European agencies and a Canadian province last week, as ultra low swap levels squeeze spreads over Treasuries.

The Republic of Austria has increased its commercial paper outstanding by 40% over the past month and lengthened its average tenors. That follows “enormous” demand for the country’s short term debt that has led to secondary market yields turning negative.

Standard & Poor’s placed 15 eurozone sovereigns on CreditWatch with negative implications on Monday. Six of those countries, including Austria, Germany and the Netherlands, are rated triple-A.