MNI EGB Issuance, Redemption and Cash Flow Matrix – W/C 27 Jan

• The EU, the Netherlands, Italy, and Germany are all due to hold auctions in the upcoming week.
• We also pencil in a 30-year syndication from Germany.
• We look for estimated gross issuance for the week at E35.4bln, down from E57.2bln this week.
• The upcoming week sees E21.8bln of redemptions of which E21.3bln are from a formerly 5-year Spanish Bono and E0.4bln are from a LATVGB.
• Coupon payments for the week total E4.1bln of which E2.6bln are Spanish, E1.0bln are Greek, E0.3bln are Italian and E0.2bln are Austrian.
• This leaves estimated net flows for the week at positive E15.5bln, vs positive E56.5bln this week.

For more see the full including an overview of the next 2 weeks of issuance, and tables showing cash flows over the upcoming weeks, see the PDF here: EZ250127.pdf

Supply Next Week

• On Monday, the EU will hold an auction to sell up to E3bln of the 2.875% Oct-29 EU-bond (ISIN: EU000A3L1CN4) and up to E2bln of the 3.00% Dec-34 EU-bond (ISIN: EU000A3K4ES4).
• On Tuesday, the Netherlands will hold a DSL auction to sell E2.0-2.5bln of the 2.50% Jan-30 DSL (ISIN: NL0015001DQ7).
• Following this on Tuesday, Italy will hold a BTP Short Term and BTPei auction. As we expected the new 2.55% Feb-27 BTP Short Term (ISIN: IT0005633794) will be launched for E2.75-3.0bln. Alongside this, E1.00-1.25bln of the 1.50% May-29 BTPei (ISIN: IT0005543803) and E1.00-1.25bln of the 1.80% May-36 BTPei (ISIN: IT0005588881) will be on offer.
• Also on Tuesday, Germany will sell E5bln of the new Mar-27 Schatz (ISIN: DE000BU22080). The coupon will be announced the preceding day.
• On Wednesday, Germany will return to the market to sell E4.5bln of the 10-year 2.50% Feb-35 Bund (ISIN: DE000BU2Z049).
• On Thursday, Italy will hold an auction to sell 5/10-year BTPs and a CCTeu. Details will be announced on Monday. We look for the on-the-run 5-year 3.00% Oct-29 BTP (ISIN: IT0005611055) to be on offer alongside 1-2 off-the-run BTPs in the 10-year area. We don’t have a strong conviction surrounding the CCTeu that will be on offer.
• We pencil in a German 30-year Bund syndication on Tuesday. We expect a similar size to last year (E6bln with E1bln retained). This avoids the Fed / ECB decision days and keeps it in January ahead of the next round of inflation data. Furthermore, a transaction in the upcoming week would be before any US tariffs start while there's also been huge demand at other recent Eurozone syndications so there is incentive to get a syndication completed now as it should be cost effective with a tight spread to benchmark/swaps. There is also a gap in the auction calendar in the following week (W/C 3 February) – however, this coincides with the Winter holidays in some regions, so we still favour the upcoming week.