LONDON, Aug 7 (IFR) - Front-end peripheral markets have backed up significantly under a good dose of profit taking as international banks hit paper out into trading screens. International accounts and dealers have also sold Bonos out to 10-years too, though it is shorter dated paper which has definitely been hit hardest. Two-year spreads to Schatz are 30+ bps wider for Spain on Tradeweb, while BTPs are 26.5 bps wider. Two-year yields have pushed back up to 3.40%+ for Spain, and 3.29% for Italy, but this should be viewed within a context where two-year Bono yields has skyrocketed as high as 6.80% at the end of July. Two-year BTP yields for their part peaked at 5.08% at the end of July.
10-year spreads now show Bonos 5.5 bps wider to Bunds, and BTPs 1+ bps wider.