Investment banks in the U.K. have started to backtrack on earlier statements that U.K. ABS would remain bullish well into August. The forecast looks cloudy, with pricing spreads inching wider on the back of continued negativity resulting from the U.S. subprime market.

U.K. RMBS structures are now being put to the test. Dresdner Kleinwort traders said most market participants are looking for any way possible to get short risk.

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