Some bank funding cost relief at last

Advertisement

Yesterday saw a step change in the CBA CDS price which finally contracted materially by -9% to 120bps:

rtwyr

This is tracking improved global credit spreads as the bear market rally in commodities eases fears of bad loans flowing into banks:

76
Advertisement

However, very steep up-trends remain in place and Australian banks are still clearly leading the widening.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.