SOUTH AFRICA: DA Says Court Application Was "Plan B", ActionSA Mulls GNU Entry

• Reoffer price 99.41 to yield 3.497%
• Size: E5bln (MNI had expected E4-6bln)
• Books in excess of E37bln (ex JLM interest)
• Maturity: June 22, 2042
• Spread set earlier at 0.40% Jun-40 OLO +8bp (guidance was +10bp area)
  • Books above EU37b (excluding JLM interest): Leads
• Coupon: 3.45%, annual, act/act, short first
• Settlement: March 11 2025 (T+5)
• ISIN: BE0000364738
• Bookrunners: BNPP, CA-CIB, DB, HSBC (B&D), MS
• Timing: FTT immediately

From market source, Bbg, DJ

Analysts expect the ECB to revise its 2025 and 2026 growth projections lower in the March forecast round, while technical assumptions are likely to push the 2025 headline projection a touch higher.

• The median of analyst estimates compiled by MNI expect the 2025 real GDP growth projection at 0.9%, two tenths below the 1.1% seen in the December round. This reflects carry-over from the weaker-than-expected Q4 flash GDP print (0.1% Q/Q vs 0.2% projected in December) and subdued activity signals at the start of 2025.
• Most analysts (with the exception of Deutsche Bank and Morgan Stanley) do not expect the ECB to incorporate potential tariff-related impacts into its projections.
• 2026 GDP is expected to be revised a tenth lower to 1.3%, but RBC instead expect an upgrade to 1.5% (mainly due to exchange rate technical assumptions).
• The cut-off date for the ECB’s technical assumptions (e.g. energy prices, exchange rate) is expected to be between Feb 7 – Feb 12. Analysts expect high gas prices and a weaker exchange rate to push the headline projection up a tenth to 2.2% (Morgan Stanley expect 2.4%). 2026 and 2027 headline projections are expected unchanged at 1.9% and 2.1% respectively.
• Analysts generally expect minimal changes to the core inflation projections through 2025-2027 (2025: 2.3%, 2026: 1.9%, 2027: 1.9$).
• Note: The March projections are compiled by ECB staff, while the December round was compiled by Eurosystem (i.e. National Central Bank) staff.

Bundesbank presents debt brake reform proposal - which would allow for extra spending through 2030 conditional on debt ratio:

• Specifically, under the proposal, "the federal and state governments would be able to spend up to a total of EUR 220 billion additionally financed by loans, provided that the debt ratio is below 60%. With a debt ratio of more than 60 percent, this framework would be limited to around 100 billion euros by 2030."
• The proposal "shows a stability-oriented path for higher government investment. It thus presents a concept that supports necessary measures to strengthen infrastructure and defence and at the same time ensures long-term sustainable public finances in line with European requirements. At the same time, it maintains its position that constitutionally secured debt brakes make an indispensable contribution to long-term sustainable public finances."
• A debt brake reform would likely be distinct to the currently discussed one-off defence funds in Germany.
• Link to full pdf here.