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#1: The 0.125% Jan-28 gilt.....>

GILT AUCTION PREVIEW
GILT AUCTION PREVIEW: #1: The 0.125% Jan-28 gilt will be on offer for GBP3.0bln
tomorrow.
- This will be the third auction of the gilt which launched in June. Tails at
both the launch auction and the first reopening were fairly wide at 0.7bp and
0.6bp respectively while the bid-to-covers were 2.06x and 1.84x. Both tails and
bid-to-covers have been notably weaker than for the new 5-year and 10-year gilts
launched over the past couple of months (the 0.125% Jan-26 and 0.375% Oct-30).
The first auction of the gilt saw almost the entire PAOF taken up but the second
auction saw the PAOF completely unused. Despite being only launched last month,
the BOE already own almost half of the outstanding volume of the gilt. In
addition to tomorrow's auction, the gilt is scheduled to be sold again on 12
August.
RESULTS: Results will be announced shortly after the auction closes at 10:00BST
with a further GBP750mln available to successful bidders via the PAOF.

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