Euro Rates Watch – Dutch 10y bond sale amidst political deadlock

by: Kim Liu

  • The DSTA will sell its 10y benchmark for an amount between EUR 2-3bn with talks between political parties to form a Dutch government having reached a stalemate
  • While we judge that the current Dutch political landscape will not affect investor sentiment, tomorrow’s auction will give a confirmation of this hypothesis
  • The Dutch Treasury lowered its 2017 funding requirement further following the publication of the Spring Memorandum but kept the bond issuance target unchanged
  • The Dutch year-to-date bond funding will increase to almost 65% of our EUR 31bn forecast (official target EUR 30 – 35bn) after tomorrow’s transaction
  • The 10y Dutch benchmark offers some value vs 10y OATs and to other Dutch bonds
Euro-Rates-Watch-Reopening-10-year-DSL-amidst-political-deadlock.pdf (225 KB)

DISCLAIMER: This report has not been prepared in accordance with the legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead. This report is marketing communication and not investment research and is intended for professional and eligible clients only.