Short Term Potential In Russia Over Turkey CDS

A major development in emerging European external debt markets over the past six months has been the inversion of the Russia over Turkey 5-year credit default swap (CDS) spread. Having averaged 135bps between 2004 and 2007, the spread collapsed to -408bps on November 20, reinforcing one of our core regional macroeconomic views favouring Turkey over Russia through the medium term.

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