Currencies

Two sovereigns pulled off successful deals on Wednesday, adding to the pile of syndicated European government bond issuance this week.

Italy is launching a new retail product, the BTP Futura, turning to its impressive stock of domestic savings to help finance its recovery. It’s an excellent move, and could be even more valuable to Italy’s recovery from the ravages of the coronavirus pandemic than the external support of the European Stability Mechanism.

Unédic is preparing to issue its second social bond following its debut trade in the format less than a month ago — itself the biggest social bond ever from any issuer.

After three eurozone sovereigns hit the primary market on Tuesday, more supply will follow on Wednesday with Germany setting its sights on its second syndicated transaction after returning to the format in May, helping it deal with a much bigger funding programme in response to the coronavirus pandemic.

There were no issues of competing supply on Tuesday as three eurozone sovereigns amassed big order books, buoyed by last week’s expansion of the Pandemic Emergency Purchase Programme (Pepp).

Trading levels given are bid-side spreads versus mid-swaps and/or an underlying benchmark and bid-yields from the close of business on Monday, June 8. The source for secondary trading levels is ICE Data Services.

Spain and SNCF SA announced new euro benchmarks with 20 year maturities on Monday, following the European Investment Bank’s record-breaking effort in the tenor last Friday.

Greece and Ireland are set to test the primary bond market this week, returning to one buoyed by a fresh injection of confidence after the European Central Bank expanded its Pndemic Emergency Purchase Programme (Pepp) last week.

Slovakia will not be making use of the European Stability Mechanism’s pandemic crisis support lines, because of concerns that investors would look negatively on the decision.

A subsidiary of China National Chemical Corp (ChemChina) has returned to the market for an €860m dual-tranche loan.

The European Central Bank delivered a welcome — and bigger than expected — increase to both the size and scale of its Pandemic Emergency Purchase Programme (Pepp) on Thursday, causing eurozone periphery spreads to ratchet in while staving off concerns of debt sustainability for the moment. Lewis McLellan reports.

A trio of double-A rated SSA names from South Korea, Central America and France tapped the Swiss franc market this week, raising a combined Sfr550m ($575.8m) and paving the way for other similar issuers to follow.