EUROZONE ISSUANCE: EGB Supply
Slovakia has announced a mandate for a syndication while Germany, Spain and France are all still due to hold auctions this week and Italy is due to launch its inaugural retail BTP Piu. Already this week, the ESM held a syndication whilst Slovakia and Finland held auctions. We look for estimated gross issuance for the week of E37.4bln (excluding the retail operation), down from E50.9bln last week.
For the full document including more details on issuance this week and next week click here.
- Slovakia is likely to hold a syndication today after it announced a mandate for a new 15-year SlovGB maturing 27 February 2040 to take place in the “near future”. We pencil in a transaction size of E2.5-3.5bln.
- The maturity is a little shorter than we had expected, we had looked for a new 12-year 2037 SlovGB to launch via syndication in February.
- This morning, Germany will return to the market to sell E4.5bln of the 10-year 2.50% Feb-35 Bund (ISIN: DE000BU2Z049).
- Tomorrow, Spain will hold a Bono/Obli auction. On offer will be a combined E4.5-5.5bln of the on-the-run 2.40% May-28 Bono (ISIN: ES0000012O59) and the 2.70% Jan-30 Bono (ISIN: ES0000012O00) alongside the 3.55% Oct-33 Obli (ISIN: ES0000012L78).
- Also tomorrow, France will hold a MT OAT auction selling a combined E11.5-13.5bln. The new 3-year 2.40% Sep-28 OAT (ISIN: FR001400XLW2), the 0% Nov-29 OAT (ISIN: FR0013451507) and the on-the-run 5-year 2.75% Feb-30 OAT (ISIN: FR001400PM68) will be on offer.
- Later tomorrow, France will return to hold a IL OAT auction to issue a combined E1.50-2.25bln. The 0.10% Jul-31 OATei (ISIN: FR0014001N38). The 0.10% Jul-36 OATei (ISIN: FR0013327491), the 0.95% Jul-43 OATei (ISIN: FR001400QCA1) and the 0.10% Mar-32 OATi (ISIN: FR0014003N51) will be on offer.
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EURGBP TECHS: Trend Needle Points North
- RES 4: 0.8530 76.4% retracement of the Aug 8 - Dec 19 downleg
- RES 3: 0.8494 High Aug 26 ‘24
- RES 2: 0.8471 61.8% retracement of the Aug 8 - Dec 19 downleg
- RES 1: 0.8463 High Jan 15
- PRICE: 0.8441 @ 06:45 GMT Jan 18
- SUP 1: 0.8385 Low Jan 14
- SUP 2: 0.8336/8284 50-day EMA / Low Jan 8
- SUP 3: 0.8263 Low Dec 31
- SUP 4: 0.8223 Low Dec 19
EURGBP maintains a firmer tone and the cross continues to trade closer to its recent highs. The latest recovery undermines the recent bearish theme and suggests scope for stronger short-term gains. 0.8376, the Nov 19 high and a key resistance, has been cleared. Note too that 0.8448, the Oct 31 high, has been pierced, a clear break of this hurdle would strengthen the bullish theme. Support at the 50-day EMA is at 0.8336.
EUROZONE ISSUANCE: EGB Supply - W/C 20 Jan: Auctions (2/2)
- On Thursday, France will hold an MT OATs auction to sell a combined E11.0-13.0bln of the 2.50% Sep-27 OAT (ISIN: FR001400NBC6), the 5.50% Apr-29 OAT (ISIN: FR0000571218) and the 2.75% Feb-30 OAT (ISIN: FR001400PM68).
- Later on Thursday, France will also hold an I/L OATs auction to sell a combined E1.5-2.25bln of the 0.60% Jul-34 OATei (ISIN: FR001400JI88), the 1.80% Jul-40 OATei (ISIN: FR0010447367), the 0.10% Jul-53 OATei (ISIN: FR0014008181) and the 0.55% Mar-39 OATi (ISIN: FR001400IKW5).
NOMINAL FLOWS: The upcoming week sees no redemptions. Coupon payments for the week total E0.3bln of which E0.1bln are Slovakian and E0.1bln Greek. This leaves estimated net flows for the week at positive E50.2bln, vs positive E25.4bln last week.
EUROZONE ISSUANCE: EGB Supply - W/C 20 Jan: Auctions (1/2)
Slovakia, Germany and France are all due to hold auctions in the upcoming week while the EFSF is expected to hold a syndication. We pencil in further syndications from Austria, Finland and Spain. We look for estimated gross issuance for the week at E50.5bln, up from E40.9bln last week.
- Today, Slovakia will hold a 3/8/9/20-year SlovGB auction. On offer will be the 3.00% Feb-28 SlovGB (ISIN: SK4000024683), the 3.625% Jun-33 SlovGB (ISIN: SK4000023230), the 3.75% Mar-34 SlovGB (ISIN: SK4000024865) and the 4.00% Feb-43 SlovGB (ISIN: SK4000022547).
- Note that this will be the first reopening of the 4.00% Feb-43 SlovGB since its syndicated launch in February 2023.
- Tomorrow, Germany will hold a Green auction to sell E1bln of the 2.10% Apr-29 Green Bobl (ISIN: DE000BU35025) and E1bln of the 2.30% Feb-33 Green Bund (ISIN: DE000BU3Z005).
- On Wednesday, Germany will hold a 15-year Bund auction, looking to sell E1.5bln of the 2.60% May-41 Bund (ISIN: DE000BU2F009) alongside E500mln of the 2.50% Jul-44 Bund (ISIN: DE0001135481).
