Robeco: Portugal verkauft Staatsanleihen mit negativer Rendite

Main market events

Peripheral bond yields on average rose somewhat last week. On Tuesday markets rallied afterECB’s Coeuré announced the ECB will frontload QE buying ahead of an expected low-liquidityperiod in the summer, but the rally was short lived. Portuguese bonds have returned 3.6% thisyear, Italian bonds 1.7%, Spanish bonds 0.3% and Irish bonds 0.3%.

Greece

Greece aims to reach a partial cash-for-reforms deal in the next 10 days. A meeting betweenTsipras, Merkel and Hollande failed to reach an agreement, with Merkel noting that “it was afriendly, constructive discussion”, but “further work has to be done with the three institutions”.

Portugal

Portugal sold six-month bills at a negative yield for the first time. The country’s debt agency saidit sold EUR 300 million of the securities at an average yield of minus 0.002 percent.

Italy

Italy approved the anti-corruption law, which raises the penalty for corruption while indictedofficials can no longer ask for a plea bargain unless they restore the profits from the crime.The IMF raised Italian GDP growth forecasts to 0.7% this year and 1.2% in 2016. The recovery ismainly driven by the ECB’s QE program, lower oil prices and a weaker euro. The IMF urged theItalian government to continue with reforms as structural weaknesses persist.

Spain

The Spanish Minister of Economy expects real GDP in 2015 to rise to 3.5%, up from 1.4% in 2014.Spanish non-performing loans continue to decrease. The current NPL ratio of 12.1% is the lowestsince July 2013.

Robeco Euro Government Bonds

We remain positive on peripheral bond markets. Fundamentals are improving with strongergrowth. The ECB’s bond buying spurs the ‘search for yield’ by investors. Peripheral bonds remainattractive in this environment.Volatility has increased in markets as the negotiations with Greece have toughened. We doexpect a positive outcome will be reached in the end, but have scaled back positions in themeantime. As long as Greece is able to pay its IMF/ECB bills we expect the negotiations tocontinue. 

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