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EGB Supply For W/C June 20, 2022 (2/2)

EUROZONE ISSUANCE
  • On Wednesday, Germany will look to sell E1.5bln of the 1.00% May-38 Bund (ISIN: DE0001102598).
  • On Friday, Italy will look to sell BTP Short Term/BTPei. The MEF made no mention of a new BTP Short-Term in its Q2 issuance guidance, but we note that the on-the-run 0% Nov-23 BTP Short Term now has E15bln outstanding and is therefore a similar size to the previous two BTP Short Terms before they were replaced with a new benchmark. We therefore think there is around a 50% chance that we see a new BTP Short Term issued (with a new issue in July if not). For the BTPei auction, given we have the 8-year BTP Italia shortly beforehand, we think there is a chance the MEF skips the auction this month, or alternatively issues a long-term BTPei. Details will be announced tomorrow.

NET NOMINAL FLOWS: There is only a negligible redemption of E0.1bln with coupon payments of E4.0bln due (of which E3.3bln are Finnish). Together with estimated gross nominal issuance of E17.4bln, this leaves estimated net flows for the week at positive E13.3bln (down from the positive E20.3bln last week).

For a calendar of all announced EGB/EU/ESM/EFSF auctions see the MNI EZ/UK Bond Supply Calendar here.

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  • On Wednesday, Germany will look to sell E1.5bln of the 1.00% May-38 Bund (ISIN: DE0001102598).
  • On Friday, Italy will look to sell BTP Short Term/BTPei. The MEF made no mention of a new BTP Short-Term in its Q2 issuance guidance, but we note that the on-the-run 0% Nov-23 BTP Short Term now has E15bln outstanding and is therefore a similar size to the previous two BTP Short Terms before they were replaced with a new benchmark. We therefore think there is around a 50% chance that we see a new BTP Short Term issued (with a new issue in July if not). For the BTPei auction, given we have the 8-year BTP Italia shortly beforehand, we think there is a chance the MEF skips the auction this month, or alternatively issues a long-term BTPei. Details will be announced tomorrow.

NET NOMINAL FLOWS: There is only a negligible redemption of E0.1bln with coupon payments of E4.0bln due (of which E3.3bln are Finnish). Together with estimated gross nominal issuance of E17.4bln, this leaves estimated net flows for the week at positive E13.3bln (down from the positive E20.3bln last week).

For a calendar of all announced EGB/EU/ESM/EFSF auctions see the MNI EZ/UK Bond Supply Calendar here.