UK DMO UPDATE: Consultation for next week's short-dated tender today

Spain, Belgium, Finland and Italy are due to sell bills this week, whilst France already came to the market yesterday. We expect issuance to be E24.1bln in first round operations, down from E26.7bln last week. 

• This morning, Spain will come to the market to sell a combined E2-3bln of the 3-month Jun 6, 2025 letras and the 9-month Dec 5, 2025 letras.
• Also today, Belgium will issue a combined E2.4-2.8bln of TCs: An indicative E0.8bln of the 4-month Jul 10, 2025 TC and an indicative E1.8bln of the new 12-month Mar 12, 2026 TC will be on offer.
• Finally today, Finland will look to sell up to a combined E2bln of the 8-month Nov 13, 2025 RFTB and the new 11-month Feb 13, 2026 RFTB.
• To conclude issuance for the week tomorrow, Italy will sell the new 12-month Mar 13, 2026 BOT with E9.0bln on offer.

• RES 4: 0.8530 76.4% retracement of the Aug 8 - Dec 19 ‘24 bear leg         
• RES 3: 0.8494 High Aug 26 ‘24 
• RES 2: 0.8474 High Jan 20 and a key resistance
• RES 1: 0.8462 High Jan 24   
• PRICE: 0.8427 @ 06:35 GMT Mar 11 
• SUP 1: 0.8360/8331 Low Mar 6 / 50-day EMA    
• SUP 2: 0.8299/41 Low Mar 5 / 3 and a near-term bear trigger 
• SUP 3: 0.8223 Low Dec 19 and a key support  
• SUP 4: 0.8203 Low Mar 7 ‘22 and a lowest point of a multi-year range

A bull cycle in EURGBP remains in play and the cross is again trading higher, today. Last week's rally highlights a clear short-term reversal and price remains above both the 20- and 50-day EMAs. Note that 0.8419, 76.4% of the Jan 20 - Mar 3 bear leg, has been breached. This paves the way for a climb towards 0.8474, the Jan 20 high and a key resistance. On the downside, initial firm support is seen at 0.8331, the 50-day EMA.

EUR demand as German Green Party co-leader Brantner points to hope re: a fiscal deal being struck this week.

• Brantner also stresses that the party is ready to negotiate, although pushes back against the idea of giving a “blank cheque”.
• A reminder that most expected a fiscal deal to be struck ahead of the sitting of the new Bundestag later this month, even after the well-known stumbling blocks for the Greens were stressed/highlighted by senior party members over the weekend.
• EUR/USD to fresh session highs of 1.0869 vs. 1.0842 ahead of the comments.
• Initial resistance at the March 7 high (1.0889).
• Moving average studies in the pair underscore the bullish technical theme.