EGB supply for W/C 24 May, 2021

Italy is due to return to the market today while the Netherlands, the EU, Germany and Italy have already issued this week. We estimate gross nominal issuance for the week of E17.9bln, substantially down on last week's E47.6bln.

• The Netherlands came to the market on Tuesday to sell E1.7bln of the long 25-year 2.75% Jan-47 DSL against an issuance target of E1-2bln.
• The EU held a syndication on Tuesday, tapping E460mln of the 0.25% Apr-36 bond with the proceeds to be used for its MFA programme.
• Italy sold E3.5bln of the 0% Nov-22 BTP Short Term and E1.25bln of the short 10-year 0.40% May-30 BTPei on Wednesday.
• Germany saw another very weak auction on Wednesday with bids of only E1.83bln against the E2.5bln of its 15-year 0% May-36 Bund on offer. This saw just E1.73bln allotted with a bid-to-cover of 0.73x and bid-to-offer of 1.06x.
• Italy will conclude issuance for the week this morning, selling up to E8.5bln of MT/LT BTPs: E2.5-3.0bln of the 0% Apr-26 BTP, E3.0-3.5bln of the 0.60% Aug-31 BTP and E1.5-2.0bln of the 0.50% Apr-26 CCTeu.

NET NOMINAL FLOWS: There was a large E20.31bln French OAT that matured on 25 May with a further E9.2bln of coupons due (E8.3bln of which are French). These will likely outweigh gross issuance of E17.9bln, leaving net negative nominal flows of E-11.7bln. This is in contrast to last week's net nominal flow of E44.9bln.

For a longer look ahead see the MNI Eurozone/UK Bond Auction calendar.