摩根士丹利－EUROPEAN－INTEREST－Rate－Strategist－：－Draghi－Speaks－Easy

DualAtlas

摩根士丹利－EUROPEAN－INTEREST－Rate－Strategist－：－Draghi－Speaks－Easy

Regular Features
Summary of Rate Views (p. 2)
Bond Supply Calendar and Cash Flows (p. 17-21)
12 Month Yield Forecasts (p. 22)
European Government Ratings Tracker (p. 23)
EUR Rate Strategy Portfolio (p. 24)
GBP Rate Strategy Portfolio (p. 25)

Euro Rates: Draghi Speaks Easy
The market is pricing in a 65% chance of a 15bp cut in the refi rate. With the tendency of investors to consider ‘what’s next?’, we recommend the long peripheral trades, short schatz spreads and long the RAGB belly vs DBR wings on the curve (p. 3).
Euro Sovereigns: Ready, Steady, Compress
The baseline scenario for the June ECB meeting is bullish rates and bullish spreads. Given the risk-reward skew, we maintain our sovereign positions in 10y Spain vs. Germany, 5s7s BTP flatteners, as well as entering 5s10s Irish flattener (p. 5).
UK Strategy: What to Expect from the Inflation Report
Governor Carney is likely to face questions on the housing market. We think if he lays out the macro-prudential tools available to counter house price rises, instead of Bank Rate hikes, the front end should be supported (p. 8).
Euro Inflation Strategy: Spread Your Wings The 10y sector of the BTPei curve is now the best place to express a spread tightening view, so we go long BTPei23s vs. Bundei23s on real yield. Meanwhile, OBLei18s is rich ahead of next week’s auction, yet we still see reasons to be positive about it (p. 10).
Special Topic: Price Action around Index Extensions We look at historical price action around broad European government bond index extensions. Our analysis suggests that returns have been positively skewed post large index extensions for Bund and euro sovereign indices (p. 13).
Supply in the Week Ahead: