New Swedish 10y government bond

The new 10y bond SGB 1057 (maturity 2023-11-13) will be issued this week, both through an outright auction and through bond switches.

Both SGB 1047 and 1054 (the buy-back bonds) look neutrally priced on the curve. Nothing special in repo market neither… Both bonds have underperformed in line with the general 5-10s steepening. The Swedish 5-10s curve has steepened relative Germany, and there seems to be some relative value in 10y bonds currently.

We see ”fair-value” for the yield spreads in the bond switches as following:

SGB 1047-1057 33-35 bps
SGB 1054-1057 16-18 bps

Obviously, the estimations above will change with the market.