Report
Buy 2Y BTP vs. 5Y France
The reelection of Sergio Matterella is a supportive factor for Italian BTP. As we expect more bear steepening ahead, we see more value in being long 2Y BTP ( which are showing a 1 0bp tightening potential vs. Schatz ) vs 5Y OA T . 5Y OAT are still relatively rich vs OBL (17bp spread) and should underperform on the back a more hawkish ECB stance + is still a good option in case of rising political premium in France. The trade will benefit from the BTP’s better Roll-down & Carry prospects.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Cyril Regnat
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