Moreover, Czech yields rose even faster
than their German or U.S. peers. Finally, 5-
year tender was a little disaster, as
investors’ bids were well below Finance
Ministry’s offer. Hence the yield curve
moved up by some 5 bps.
Investors asked papers only for CZK 6.2 bn,
while the ministry supplied CZK 9 bn of new
5-year benchmark with coupon 2.55%. In
the end, it sold only CZK 4.7 bn with
average yield 2.684 %. Yesterday’s auction
again proved that the belly of the curve is
not favored by investors. Mid-term tenders
have historically the worst performance.
Today negative atmosphere may resume, as
traders may look at U.S. figures. Domestic
calendar is empty.
(CSOB - Investment research)