8/15/25-year IGBs

The NTMA will come to the market this morning to sell E1.00-1.25bln of 8/15/25-year IGBs.

• 1.10% May-29 IGB: The former 10-year benchmark will be on offer for the first time since May 2020 this morning. Since February until mid-May the spread between the 1.10% May-29 IGB and the benchmark 10-year 0% Oct-31 IGB had been slowly widening to a peak of around 25bp. This had fallen back to around 24bp ahead of the auction announcement and at the time of writing is closer to 23bp. There hasn't been an auction held between the benchmark 7-year bond and 10-year bonds recently, indeed the last 7-year auction was held in October.
• 1.70% May-37 IGB: The former 20-year benchmark was launched in 2017 and this is the first time it will be reopened since February 2019. The closest comparable auction is the reopening of the 0.30% May-35 IGB in October which saw E803mln of bids with E525mln sold (bid-to-cover of 1.53x).
• 2.00% Feb-45 IGB: The 2.00% Feb-45 was launched as the 30-year benchmark in 2015 but has not been reopened since 2018. It now serves as the 25-year current coupon bond. In 2021 we have seen the 20-year 0.55% Apr-41 IGB launch via syndication in April for E3.5bln (book of E35bln) and two reopenings of the 30-year 1.50% May-50 IGB - most recently last month with E300mln sold from E505mln bids.
• Timing: Results will be available shortly after the auction closes at 10:00BST with a further 15% sold via non-competitive auction that will close at 10:00BST on Monday.