In the current environment of risk aversion, where global equity indices from the S&P 500 to the Shanghai Composite are correcting lower, our focus is drawn to Spain. The Spanish IBEX index is trading at levels not seen since 2009 and the 10-year benchmark yield is back above 6%. This has forced the spread against the German 10-year yield to new wides for the year and subsequently put the major EUR crosses in FX space under further downside pressure.
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Barclays Capital