MNI EU Credit Weekly: Friday Volatility

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Executive Summary: Friday Volatility

• Spreads closed 0.9bps wider on the week following the post-NFP move. Chart below is pre-NFP when spreads were 1.1bps tighter.
• Macro 2s/10s Bunds snapped lower post-employment closing -3/-5bps on the week. Canada, Switzerland and the Pharma sector were the latest to suffer from trade bargaining after what had been a positive start to the week on an EU/US deal.
• Fund Flows continue to see inflows into European risk with noticeable strength in Euro IG continuing.  
• Supply remained subdued as we head into the August lull; <€5bn this week, all from corps. Pricing remained tight with coverage ratios above the trailing average.