July 21, 2022 08:12 GMT
GILT AUCTION PREVIEW
- The DMO is due to return to the market this morning to offer GBP3.5bln nominal of the short 3-year 0.25% Jan-25 gilt.
- This will be the sixth auction of the gilt, and the largest nominal auction size since the launch auction in July 2021.
- Auctions since have been for GBP3.00-3.25bln. The last two auctions have seen relatively wide tails of 1.0bp in June and 2.5bp in March respectively.
- Bid-to-covers have never fallen below 1.9x; however we have seen bid-to-covers below 2.00x on two occasions – no other gilt has seen a bid-to-cover below 2.00x since the beginning of 2021.
- Timing: Results will be available shortly after the auction closes at 10:00BST with a further GBP875mln available to successful bidders through the PAOF.