Spain

Spain took itself over the 90% mark of its reduced 2015 funding programme with an auction where yields fell across the maturity curve.

Caja Rurales Unidas issued a €750m five year deal on Thursday, building a slightly oversubscribed book in a short time frame by offering a relatively attractive new issue premium.

Santander and BBVA both looked to the dollar market to secure senior funding on Tuesday amid a bare session for European FIG issuance.

Portugal is underperforming its nearest peers in the eurozone periphery ahead of a debt auction later this week, amid tense talks to form a government for the country.

Italy has sparked a busy week for the eurozone periphery by cutting its borrowing costs at an auction of short term debt.

Following the announcement of a rating upgrade of the Kingdom of Spain by Standard & Poor’s on Friday, several Cédulas programmes are likely to be upgraded. But since no regulatory rating thresholds is likely to be broken, spreads should be unaffected, said Commerzbank analysts on Monday.

Santander fell victim to market spasms this week, pulling a dollar trade amid extreme volatility.

Swedish Covered Bond Corp (SCBC) and Bankinter issued €750m covered bonds this week, but after record issuance, their limp receptions may cause others to postpone funding plans.

Spain’s borrowing costs dropped to their lowest levels since spring at an auction on Thursday, rounding off a week where the country outperformed its nearest peer in secondary markets.

Bankinter repriced the Cédulas market at least 5bp wider, and its own curve by around 15bp wider on Thursday, with a benchmark five year deal. But with the longer term outlook set to improve, the transaction is expected to have tremendous performance potential.

Spain is enjoying a strong warm-up for a debt auction this week, as its yields fell faster than its eurozone periphery peers following a Catalonian election where independence parties won just under 50% of the vote.

Banco Popular Español (BPE) and Caja Rural de Castilla-La Mancha (CRCLM) issued Cédulas this week that were barely subscribed and relied heavily on demand from the European Central Bank.