Italian Sovereign

Spain highlighted on Thursday the retracement in yields since the launch of eurozone quantitative easing, as it paid to borrow at pre-QE prices.

Greece’s protracted negotiations with its international creditors stifled potential peripheral eurozone syndications this week — and the one issuer that did come had to take a defensive approach.

Italy crunched down its borrowing costs to new lows at auction on Thursday — and unveiled its issuance plans for the second quarter of the year.

Italy showcased the rampant demand at the long end of the euro curve with a record equalling €8bn deal this week — but also highlighted new hedge fund behaviour.

A European sovereign and agency have opted to bring euro benchmarks at the long end of the curve on Tuesday, after hiring lead managers on Monday.

The lonely path that Greece is wandering away from the rest of the eurozone periphery was in sharp focus at a pair of bill auctions on Wednesday.

Italy smashed its five and 10 year yield records at auction on Thursday, as the eurozone periphery enjoyed strong interest from investors.

Spain scored its lowest coupon and biggest deal in the 15 year part of the curve on Wednesday, as eurozone periphery sovereigns enjoyed enviable conditions.

Italy hit record low yields at auction and Spain paid a tenth of a basis point to place bills amid strong signs that Greece will receive a bail-out extension.

The proximity of a deal to extend Greece’s credit lifeline compressed eurozone periphery spreads on Monday, boding well for a flurry of auctions and a potential syndication this week.

The Republic of Italy has nipped in with a couple of long dated privately placed deals that took advantage of the curve flattening in the euro market since the European Central Bank announced a programme of SSA bond buying just over a week ago.

After a benign start to the week for sovereign and agency borrowers in the eurozone periphery in the aftermath of the Greek general election — allowing several issuers to print paper at record breaking low yields — the fears of a political standoff between the new Hellenic government and its European peers led to a softer tone mid-week. But public sector bankers remain confident that Greece’s problems are, in the short term, its own.