BoE inflation report pushes CDSs on European financials wider
The cost of credit protection on European financials increased this morning following the release of the Bank of England's quarterly inflation report. The report conceded UK GDP growth had been slower than expected in the first quarter of 2009, and revised predictions for when bank lending would return to normal.
Five-year senior credit default swap (CDS) spreads referencing Barclays widened from 145.8bp at yesterday's close to 154.8bp at 1:30pm BST, according to data provided by credit information specialist CMA Datavision. Royal Bank of Scotland saw its CDSs push out from 153.8bp to 163.9bp. CDSs on Lloyds TSB moved out from 156bp to 158.3bp.
In Germany - where the government today pushed forward a 'bad bank' scheme to purchase toxic assets from banks' balance sheets -CDSs on Deutsche Bank moved out
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