Liquid Insight: Germany: changing dynamics

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Liquid Insight: Germany: changing dynamics

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Liquid Insight

Germany: changing dynamics

Key takeaways 14 July 2026

Rates and Currencies Research• German bonds are richening less than usual vs swaps and vs the periphery in recent

Global risk-off episodes. While looking stable...

• ... we show GE swap spreads have cheapened vs global dynamics. Supply, growth

weakness & fiscal uncertainty could be at play GlobalMLI (UK)Rates & Currencies Research

• seasonality points to outright tightening in Aug. More could follow if/when the buyer Sphia Salim

base shifts towards leveraged accounts. Rates Strategist MLI (UK)

+44 20 7996 2227

sphia.salim@bofa.com

By Sphia Salim, Edvard Davidsson Edvard Davidsson

Chart of the day: German swap spreads look tight (bonds cheap vs swaps) based on historical RatesMLI (UK)Strategist

joint dynamics of global spreads +44 75 2142 7901

Latest residual of 10y swap spreads (vs OIS) based on global PCA * edvard.davidsson@bofa.com

Oliver Levingston

6 FX and Rates Strategist

Merrill Lynch (Hong Kong)

4 +852 3508 4631 oliver.levingston@bofa.com

2 See Team Page for List of Analysts

-2 Liquid Insight

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