The hefty cross market moves in linkers/BEIs seen over the summer offer a very good opportunity to position for tighter front-end BEI boxes/real rate spreads.
We recommend buying OBLi 2018 versus selling SGBi3107 (June 2017). We also suggest buying SGBi3109 in the auction and selling SGBi3107 in a curve flattener.
The July CPI came in 0.15 percentage points higher than we anticipated at -0.33% m/m. Does this justify a change in projections in the coming months?
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