They are using swaps or structured notes to benefit from a global disconnect in inflation, which is becoming apparent after a period of disinflation.
“We are seeing some clients wanting to play, for example, de-coupling of North America compared to Latin America, playing the inflation indices,” said Brice Benaben, Deutsche Bank global head of inflation trading in London. “It will be products like a structured note or swap, where you play the spreads between, say, the forward inflation in the U.S.
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