Live Markets: Go long French 30-year bonds, UBS say
05/09/2025 10:34
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com. GO LONG FRENCH 30-YEAR BONDS, UBS SAY The themes of the last couple of weeks in government bond world have been an underperformance of French bonds relative to euro zone peers, and a global selloff in long-dated 30 year bonds. That makes UBS' call to go long the French-30 year stand out. They are targeting a fall in the yield to 4.25% - it's currently 4.4%. FR30YT=RR They have a few reasons, firstly that 4.25% is just the level from mid August, so they think is "not much of a stretch". On top of that, they say there are political risks, but investors "have a much better understanding of the complexity of the budget process compared with a year ago". French debt underperformed around the time of last year's election before recovering. And also, they say there is greater willingness from investors to reallocate from Treasuries to European government bonds and FX-hedged dollar returns on French bonds are high. They remain short French 10-year notes versus euro swaps, however. (Alun John) ***** EARLIER LIVE MARKETS POSTS TEMENOS STANDS OUT IN SUBDUED EARLY TRADING CLICK HERE EUROPE BEFORE THE BELL: CAUTIOUSLY HIGHER AHEAD OF PAYROLLS CLICK HERE MORNING BID: MARKETS BET BIG ON GOLDILOCKS PAYROLLS NUMBER CLICK HERE