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This week will see issuance from Italy, Germany, Spain and France. MNI estimates gross issuance for this week at E18.4bln, up from last week's E11.5bln.

  • Italy kicked off issuance yesterday morning selling on-the-run 5/10-year BTPs alongside a long 7-year CCTeu. The following was sold: E2.0bln of the 0% Aug-26 BTP, E2.25bln of the 0.95% Jun-32 BTP and E1.5bln of the 0.65% Apr-29 CCTeu.
  • Germany also came to the market yesterday, allotting E2.308bln of the 7-year 0% Nov-28 Bund in another weak German auction which had an intended issuance volume of E3bln.
  • Germany will return to the market this morning to kick off December issuance with E3bln of the 0% Oct-26 Bobl on offer.
  • Spain will come to the market tomorrow with the off-the-run 4-year 2.15% Oct-25 Obli, on-the-run 10-year 0.50% Oct-31 Obli and 0.70% Nov-33 Obli-Ei on offer. E1.5-2.5bln of nominals will be on offer alongside E250-750mln of linkers.
  • France will conclude issuance for the week tomorrow and also hold its last auction of 2021 with E3-4bln of off-the-run LT OATs on offer: the 2.50% May-30 OAT, the 4.50% Apr-41 OAT and the 3.25% May-45 OAT.

NET NOMINAL FLOWS: There are notable redemptions in Italy (E15.2bln CTZ), Spain (E6.75bln Boni-i) and also Portugal (E1.5bln of a PGB Floater). Together these redemptions total E23.4bln while coupons for the week of E1.9bln are due (E1.6bln Italian). With gross issuance of E19.3bln, we estimate negative net flows of E7.0bln this week (in contrast to net positive flows of E9.5bln last week).

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