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France tap 3 OATs Thursday...>

FRANCE AUCTION PREVIEW
FRANCE AUCTION PREVIEW: France tap 3 OATs Thursday for E6-7bln indicative size.
On offer is the OAT 0.0% Feb-21, OAT 0.0% Mar-23 and 1.75% Nov-24 OAT. An hour
later France sells E1.25-1.75bln OATi 0.10% Mar-21, OATi 0.25% Jul-24 and OATei
0.10% Mar-28. 
- BACKGROUND: There are no French coupon or redemption payments to help. 10-yr
Bund/OAT spread has extended it tightening move in April and now stand at only
21.5bps, tightest since Aug 2016. 
- RV: The OAT 0% Feb-21 still stands out as cheap in a micro-RV sense when its
ASW spread is looked at to other OATs in the sector. 2-10Y France has ever so
slightly steepened since end of March but 10-30Y spread has moderately tightened
to 83.3bp. The 10Y appears expensive on the curve. It appears that Demand for
linkers has been creeping back since mid-march despite continued fears that
inflation will remain in the lower bound for longer. The BEI for for the OATi28
has risen YTD low of 137bp on Mar 16 to 143bp today. 
- RESULTS: Nominal cut-off at 0950GMT, results 10mins later. Linkers +1 hour.

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