US: Basel III relief to boost wider spreads – TD Securities

TD Securities strategists Gennadiy Goldberg, Molly Brooks and Jan Nevruzi argue that proposed Basel III endgame and related US bank capital changes should ultimately support wider US swap spreads, particularly at the long end. TD Securities strategists Gennadiy Goldberg, Molly Brooks and Jan Nevruzi argue that proposed Basel III endgame and related US bank capital changes should ultimately… TD Securities strategists Gennadiy Goldberg, Molly Brooks and Jan Nevruzi argue that proposed Basel III endgame and related US bank capital changes should ultimately support wider US swap spreads, particularly at the long end. TD Securities strategists Gennadiy Goldberg, Molly Brooks and Jan Nevruzi argue that proposed Basel III endgame and related US bank capital changes should ultimately support wider US swap spreads, particularly at the long end. They note that deregulation is set to lower capital needs for GSIBs and smaller banks, boosting balance sheet capacity and likely improving liquidity in Treasuries and repo despite near-term geopolitical volatility.Deregulation seen supporting wider spreads"Swap spreads… For traders, the practical value is less about the headline alone and more about how it changes context, sentiment and the quality of the next decision. Watch follow-through, not just the first reaction: liquidity, volatility and confirmation across related assets usually tell the real story.