Pfandbrief spread expectations until end of the year
Inflationary expectations have noticeably increased and caused volatility in the markets for government and agency bonds since this spring. Pfandbriefe were partially exposed to the jitters, too: The steady narrowing of Pfandbrief spreads since April 2020 was followed by a slight widening in May.
At the same time, the ECB purchase programmes and TLTRO III are causing a continued shortage of supply in the primary and secondary markets. Thus, the issuance volume in the benchmark segment was at Eur 8 billion (-18% yoy) at the end of May 2021.
What are your Pfandbrief spread expectations until end of the year?
The trend reversal has been reached, Pfandbrief spreads will continue to widen
The widening is temporary - Pfandbrief spreads will move sideways
The widening is temporary and Pfandbrief spreads will narrow again by the turn of the year