European Rates Watch: EGB supply, positioning & flows

Research evidence excerpt

European Rates Watch: EGB supply, positioning & flows

Accessible version

European Rates Watch

EGB supply, positioning & flows

Futures positioning: Front-end back in favour 27 July 2026

Outstanding: Across the German curve, DU remains the most net-long contract Rates Research

followed by UB (Exhibit 11). In contrast, positioning in OE and RX is net short. In Italian Europe

contracts, investors are net long in IK as well as BTS, although the latter being more

European Rates Research

moderate. Meanwhile, net positioning in OATs is net short. MLI (UK)

Edvard Davidsson

Weekly change (Wed-Wed): Investors were net sellers in all German Italian, and French Rates Strategist

futures (Exhibit 12). In German futures, added shorts led net positioning in DU and UB MLI (UK)

edvard.davidsson@bofa.com

contracts. In RX longs were taken off. Positioning in the Italian BTS and IK futures, was

Sphia Salim

mostly led by longs being taken off. In OATs, longs were taken off while shorts were Rates Strategist

simultaneously added. MLI (UK) sphia.salim@bofa.com

Flows in German debt securities NathanRates StrategistThomas, CFA

Leveraged investors net sold €3.4bn of German debt securities in May, bringing MLI (UK) nathan.thomas@bofa.com

cumulative net outflows in 2026 to €10.7bn (Exhibit 41). Looking ahead to year-end

2026 and into 2027, we see scope for this investor group to increase net purchases, as

front-end duration views may turn more constructive following the ECB’s final hike.

In May, net selling was concentrated in the 2y sector. For 2026 as a whole, net selling For a list of our open trades as well

has primarily been concentrated in the sub-5y sector, with more sporadic selling also as those closed over the past 12

seen in the 15–30y sector.