CDS Spreads To Widen With Deteriorating Risk Profiles

The uptick in political risk in a number of MENA markets since the start of H2 has filtered through to higher spreads in select CDS markets, which we believe could widen even further going forward. Indeed, we highlight Egypt and Lebanon as markets where elevated political risks have caused CDS spreads to head higher (whereas the majority of other MENA markets have traded sideways), and we expect that trend to continue going forward.

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