New 10Y Government Bonds In Sweden And Denmark

Published 01/23/2017, 05:20 AM
Updated 05/14/2017, 06:45 AM

On Thursday (at 09.30 CET) in Sweden we receive producer prices, trade balance data and the labour force survey (including unemployment rate, employment etc.).

On Friday, the NIER publishes the business (BCI) and consumer (CCI) confidence surveys (at 09.00 CET) and after very strong readings in the past month, a slight recoil should come as no surprise. As for retail sales (at 09.30 CET), we believe a weak number is to be expected as the shoe and clothing industry's flash indicator was on the weak side.

The Swedish National Debt Office is to open a new 10Y bond (SGB May '28/SGB1060) on Wednesday. We expect it to trade relatively cheaply when it is introduced. We look for a +5bp spread in asw terms to SGB Nov '26 implying a 23bp yield spread. For more see Reading the Markets Sweden , 19 January.

We take a closer look at the risk of a higher Swedish inflation print in January due to more expensive vegetables.

The Danish Debt Management Office (DMO) is to introduce a new 10Y Danish government bond, DGB 0.5% 11/27 on Wednesday. We expect the DMO to sell up to DKK5bn at the auction. For more details on our view on the pricing of the new bond, see our new Reading the Markets Denmark that we published for the first time on 18 January.

In Norway , the coming week will give us a clearer idea of the state of the labour market. The NAV and LFS unemployment (November figures due Thursday) measures have long painted very different pictures of jobless levels, but have gradually begun to converge again over the past couple of months.

Given that NAV gross unemployment was flat in November, we expect LFS unemployment to be unchanged at 4.8%.

Note that last week's export numbers point to a weak Norwegian GDP growth in Q4.

To read the entire report Please click on the pdf File Below

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