Agency spreads move out, fail to snap back as expected; Pefco sells $300 million notes

By Lisa Kerner

Charlotte, N.C., Sept. 26 - Agency spreads widened overall versus Treasuries and swaps on a slow Monday, a trader said, noting a lack of a "snap back" from last week."

Agencies have "decoupled" from swaps, he said.

There was definitely pressure to sell and "more selling than buying" on the day.

"I just don't know what to expect any more," he said.

According to the trader, the two-year and five-year sectors were both out about 1 basis point, the three-year moved in 0.5 bp and the seven-year was unchanged.

The "old bond sector," or what was the 30-year sector that had seen dramatic widening at the end of last week, was out 0.5 bp.

Also on Monday, Private Export Funding Corp. sold $300 million of 2.8% notes due 2022 to yield Treasuries plus 93 basis points, according to a source.

Initially the deal was announced at $250 million.

The notes (Aaa/AA+/) were priced at 99.687 to yield 2.834%. They are non-callable.

Private Export Funding assists with financing U.S. exports through private capital and is based in New York City.

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