EURGBP TECHS: Support Remains Exposed

Austria, Germany, Spain and France are all due to hold auctions this week. We also pencil in syndications from Belgium, Ireland, Italy, Portugal and Slovenia. We estimate gross issuance for the week at E56.3bln. 

• Tomorrow, Austria will hold a 5/50-year RAGB auction with a combined E2.013bln of the 2.50% Oct-29 RAGB (ISIN: AT0000A3EPP2) and the 0.70% Apr-71 RAGB (ISIN: AT0000A2QQB6) on offer.
• Also tomorrow , Germany will sell E4.5bln of the 2.00% Dec-26 Schatz (ISIN: DE000BU22072).
• On Wednesday, Germany will return to sell E5bln of the new Feb-35 Bund (ISIN: DE000BU2Z049). The coupon will be announced tomorrow morning.
• On Thursday, Spain will hold a Bono/Obli and ObliEi auction. On offer will be a combined E5.5-6.5bln of nominals including the new 3-year 2.40% May-28 Bono (ISIN: ES0000012O59), the on-the-run 7-year 3.10% Jul-31 Obli (ISIN: ES0000012N43) and the off-the-run 20-year 2.90% Oct-46 Obli (ISIN: ES00000128C6). Alongside this E250-750mln of the 2.05% Nov-39 Obli-Ei (ISIN: ES0000012M69) will be on offer.
• Finally on Thursday, France will hold an LT OAT auction for a combined E11.0-13.0bln. This matches the largest auction size of 2024, but given this year’s higher issuance target should be no surprise. On offer will be on-the-run 10/20/30-year OATs and an off-the-run 12-year issue: the 3.00% Nov-34 OAT (ISIN: FR001400QMF9), the 1.25% May-36 OAT (ISIN: FR0013154044), the 2.50% May-43 OAT (ISIN: FR001400CMX2) and the 3.25% May-55 OAT (ISIN: FR001400OHF4).

For more on this week's issuance and a look ahead to next week see the MNI EGB Issuance, Redemption and Cash Flow Matrix here.

• RES 4: 160.00 Round number resistance   
• RES 3: 159.45 High Jul 12
• RES 2: 159.26 0.618 proj of the Sep 16 - Nov 15 - Dec 3 price swing  
• RES 1: 158.08 High Dec 26 
• PRICE: 157.67 @ 06:43 GMT Jan 6
• SUP 1: 155.89 20-day EMA
• SUP 2: 154.44 Low Dec 19  
• SUP 3: 153.85 50-day EMA
• SUP 4: 152.46 Low Dec 13  

USDJPY continues to trade below its recent high but is holding on to the bulk of its latest gains. The trend outlook remains bullish. The recent breach of 156.75, the Nov 15 high, confirmed a resumption of the uptrend and has paved the way for a move towards 159.45, the Jul 12 high. Moving average studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support is 155.89, the 20-day EMA.

Germany, the Netherlands, France, Spain, Belgium, Finland, the ESM, the EU and Italy are due to sell bills this week. We expect issuance to be E37.9bln in first round operations, up from E0.5bln last week.

• This morning, Germany will sell E2bln of the 6-month Jul 16, 2025 bubill.
• Also this morning, the Netherlands will issue E1.0-2.0bln of the 3-month Mar 28, 2025 DTC and E1.0-2.0bln of the new 6-month Jun 27, 2025 DTC.
• This afternoon, France will come to the market to sell up to E7.5bln of the 9/14/25/51-week BTFs: E0.2-0.6bln of the new 9-week Apr 16, 2025 BTF, E3.1-3.5bln of the new 14-week Apr 16, 2025 BTF, E1.2-1.6bln of the 25-week Jul 2, 2025 BTF and E1.4-1.8bln of the new 51-week Dec 31, 2025 BTF.
• Tomorrow morning, Spain will issue a combined E5.5-6.5bln of the 6-month Jul 4, 2025 letras and the new 12-month Jan 9, 2026 letras.
• Also tomorrow morning, Belgium will look to sell E3.8-4.2bln of the 4/6/11-month TCs:  an indicative E1.0bln each of the 4-month May 8, 2025 TC and the new 6-month Jul 10, 2025 TC, and an indicative E2.0bln of the new 11-month Dec 11, 2025 TC.
• Thirdly tomorrow, Finland will sell up to a combined E2bln of the 7-month Aug 13, 2025 RFTB and the 10-month Nov 13, 2025 RFTB.
• Next tomorrow, the ESM will issue up to E1.1bln of the new 3-month Apr 3, 2025 bills.
• Finally tomorrow, the EU will sell up to E1.5bln of the 3-month Apr 4, 2025 EU-bill, E1.5bln of the new 6-month Jul 4, 2025 EU-bill and E1.5bln of the new 12-month Jan 9, 2026 EU-bill.
• On Friday, Italy will issue a new 12-month BOT alongside potentially another existing BOT. Details will be announced on tomorrow.

For more on future auctions see the full MNI Eurozone/UK T-bill auction calendar here.