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Issuance volumes in the week ahead will largely depend on the size of the inaugural NGEU issue (we pencil in E14bln). On top of this we see Germany, Finland, Spain and France holding auctions for an estimated E29.0bln. Overall, therefore, we look for E43.0bln of net nominal issuance next week, up from E35.7bln this week.

  • The EU has issued an RFP for its inaugural syndication. We look for a dual/triple tranche transaction. Note that the EU plans to hold a further two transactions before the end of July. We do not have strong views which maturities will be on issued, but think that a 10/30-year dual tranche would make sense.
  • Germany will kick off auctions for the week on Tuesday with E5bln of the 0% Jun-23 Schatz on offer. Note that the last Schatz auction on 18 May was technically uncovered (but was a larger auction at E6bln.
  • Finland will also come to the market on Tuesday, looking to sell up to E1.5bln of 7/10-year RFGBs: E500mln of the 0.50% Sep-28 RFGB and E1bln of the 0.125% Sep-31 RFGB.
  • On Wednesday, Germany will return to the market to launch the new Aug-31 Bund, with a 0% coupon expected and E5bln on offer.