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16 Jun 2015
German 10-Yr bunds below 80bp for the first time in two weeks – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team comments on the key developments in the German bond market, with 10-Yr german bunds pushing below 80bp as specs give up on bearish EUR view.
Key Quotes
“The ten-year German bund yield has been pushed below 80 bp for the first time in nearly two weeks. However, the spreads are continuing to widen today. One force behind the euro's resilience appears to be speculative participants giving up on the bearish euro view. Specifically, the gross short euro position in the futures market peaked in late March near 271k contracts. As of June 9, it stood at 190.6k contracts, the smallest since last December.”
“Another factor at work is the shift in expectations for Fed policy. While the WSJ poll found that nearly three-quarters of economists expect the Fed to raise rates in September, that hike is now seen to be the only move in 2015. Recall that in March, the FOMC's dot plot pointed to two hikes this year.”
Key Quotes
“The ten-year German bund yield has been pushed below 80 bp for the first time in nearly two weeks. However, the spreads are continuing to widen today. One force behind the euro's resilience appears to be speculative participants giving up on the bearish euro view. Specifically, the gross short euro position in the futures market peaked in late March near 271k contracts. As of June 9, it stood at 190.6k contracts, the smallest since last December.”
“Another factor at work is the shift in expectations for Fed policy. While the WSJ poll found that nearly three-quarters of economists expect the Fed to raise rates in September, that hike is now seen to be the only move in 2015. Recall that in March, the FOMC's dot plot pointed to two hikes this year.”