DMO gilt operations calendar due at 7:30GMT: Our expectations (1/2)

The DMO will release its FQ1 issuance (Apr-Jun) at 7:30GMT (and note that also today at 16:30GMT the BOE will release its APF operations schedule for Q2 (Apr-Jun) at 16:30GMT today - for our expectations of the latter see the bottom of page 3 in our BOE preview). For our expectations for the DMO announcement:

Short auctions (5 auctions)

• 3.75% Mar-27 gilt: We pencil in 2-3 reopenings (in line with both GEMM and investor preferences)
• New 5-year gilt: 2-3 auctions. In terms of maturity GEMMs favoured a June/July 2029 maturity while investors mentioned March or June 2029 maturities (it now looks extremely unlikely we will see any reopenings of the 4.50% Jun-28 gilt).

• 4.00% Oct-31 gilt: We look for 1-2 reopenings (1 reopening strongly preferred by GEMMs, with "a few calls" for 2 reopenings).
• 0.875% Jul-33 green gilt: 1 auction during FQ1 (very strong support from GEMMs)
• 4.625% Jan-34 gilt: 2 reopenings (very strong support from GEMMs)
• 3.75% Jan-38 gilt: 1 reopening (unanimous support from GEMMs).

• DMO notes this is scheduled for June, we pencil in the W/C 10 June.
• The majority of the support from GEMMs and investors was for a new gilt around the 10-year maturity area rather than pushing out to anything longer. We therefore changed our expectation post-consultation to a new 2035 gilt to be launched (rather than a new Jan-37 gilt).
• We still look for a GBP8.5-10.0bln transaction.