sentix Survey Essentials (English)

Deeply downbeat on Bunds in a relative context

The latest sentix survey shows that investors’ medium-term strategic bias on Bunds remains deeply negative both in absolute terms and versus US Treasuries. In the case of Bunds versus US bonds, the negative bias has run some way ahead of recent relative moves in US-German 10Y yields, suggesting that investors may be looking for a further narrowing of the spread in the medium-term. At an asset level, participants’ negative strategic bias on bunds versus eurozone equities also remains firmly intact, while monthly questions on assets indicate that the tide of optimism on commodities continues to rise. Bunds remain unloved relative to other assets (Charts 2-4, p2).