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Market Pulse: Spanish yield spread at steepest in 20 years

Monday, August 06, 2012 - 03:24

Aug. 6 - The ''Draghi effect'' continues to be felt, pushing the Spanish 2y-10y yield curve to its steepest in two decades. So the immediate pressure on Spain eases, but September could be crunch time again.

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-- drug effects still being felt across European markets today speaking to you borrowing costs are the lowest in three months. I'm Jamie gave this as market pulse. Let's face streets at -- -- -- each of these market analyst at ING index trust some fairly dramatic moves on the spot as yields act today. Particularly at the shot tend -- Justine -- percent. It does seem as if the drug if it really is taking hold throughout this iPhone comics especially the short end. As you install and our expectations that was the bond buying from the ECB viceroy of India photo from press conference last week. That don't forget I mean just them on the attain this goal that -- above 7%. Before his speech and on the exactly been the move has been quite impressive really haven't come down from some sense of around half fat now. Amidst indication of how the events is ridiculous that the ECB funniest behind them and expecting some of action. To come later -- -- -- -- now to the track is managed to win over support from the other members of the Central Bank. And of course the -- the fall in the short time Hazmat they've become a sticking point to not play just looking though. 350. Basis points as the steepest has been and that twenty years. But exactly so it's the reflection of Spain is now some more able to fund itself initial to -- the key element ready at the moment in the debt crisis that they come and imitate. -- keep himself -- For the rest of the year or at least until October now has no bond auctions planned for August so at least for the moment time has been -- for the government. I mean as you say space -- -- told up all of this has traditionally holy month. Do you -- been over the -- will request a bailout and if so when. If it does also the one and it's like to do so for relates thrown in September we have the German constitutional courses and on September the twelfth civil freeway until off of that that's been. Decided and then we'll see whether Spain -- users of funding position then and what conditions it once have attached to any fan I -- from the EU. And of course not I don't apply the premise that because -- SEC speed backtracking slightly on his no bailout Stein's son but Spain what's about it. It's really is in the same boat. It's sort of one step behind Spain made easily thinks the the next dominant system if you have. Paris is pushing both Spain and athletes receive a ban on any sort of have a dots between. -- it in -- the -- goes fast. But it's likely the noise when it comes from Rem is that Italy will try isolates at least until Spain this season -- out before he considers its own options in this process. Just to finish up Chris hyped how would you how do you trade that banks on the financials of both Spain announced on Italy under huge pressure on the last few months. As some lights at the end of the tunnel. But it does seem as time there's a bit of brief press by the bags and -- -- an extremely -- a sort of optimism continue for the festival with some some on the expectation. The we'll see action from the east nation yet so for now. You might see the rally continue the long term this feature still remains somewhat uncertain for those banks if they dependent on actions from the ECB. -- just thank you very much my -- that -- exempt from IG index plenty more throughout the afternoon and keep up with us on what's up. Hot Reuters incite them. I'm Jamie give up this -- Reuters.

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Market Pulse: Spanish yield spread at steepest in 20 years

Monday, August 06, 2012 - 03:24