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📝10s30s Curve Flattening Could Re-Intensify: Goldman Sachs

Writer's picture: Rosbel DuránRosbel Durán

High correlation between U.K. and U.S. rates should moderate as the extreme volatility in U.K. rates subsides. We look for the U.K.'s policy trajectory, if maintained, will have a limited read-through to U.S. yields, while it should result in higher risk premia in U.K. gilt yields relative to other sovereign debt markets.

The 10s30s curve flattening could re-intensify on more restrictive policy or higher vol, but slope versus level of 2s favors selling 10s30s curve floors to fund 2y payers.

- Goldman Sachs Rates Strategy



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