EGB Supply

Germany is due to return to the market while Italy and Belgium are also still due to issue this week. France, Slovakia and the Netherlands have all to the market already. We pencil in estimated gross issuance for the week at E25.3bln, down from E30.0bln last week. We also note the huge redemptions and coupon payments.

• This morning, Italy will come to the market to hold a 5/10-year BTP and CCTeu auction, including launches of 5/10-year BTPs with a total auction size of up to E9.75bln: E3.50-3.75bln of the new 5-year 3.35% Jul-29 BTP (ISIN: IT0005584849; we had only expected an outside chance of this being launched this week - instead thinking a February launch was more likely), E4.0-4.5bln of the new 10-year 3.85% Jul-34 BTP (ISIN: IT0005584856; in line with MNI's expectation) and E1.0-1.5bln of the 1.15% Oct-31 CCTeu (ISIN: IT0005554982).
• Also this morning, Germany will return to the market to hold a 15-year Bund auction. On offer will the E1bln of the on-the-run 1.00% May-38 Bund (ISIN: DE0001102598) alongside E500mln of the 3.25% Jul-42 Bund (ISIN: DE0001135432).
• Italy is due to launch a new retail-only 6-year Mar-30 BTP Valore (ISIN: IT0005583478) this week. Books opened on Monday and already stand at E11.05bln sold across the first 2 days (slightly higher than the E10.63bln across the first two days for the 4-year in June and in excess of the E9.31bln seen for the 5-year in October).
• Note that subscriptions for the next retail-only Belgium State Bonds (Bons d’Etat) opened on Thursday 22 February. Belgium plans to launch a new 1-year issue (ISIN: BE3871294240) and a new 3-year issue (ISIN: BE3871295254). Takeup on the first two days has been very low: E223mln in total for the 1 year (E146mln on day 1 and E77mln on day 2) and E10mln of the 3-year (E5mln on each of day 1 and 2).

EZ240228.pdf