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Germany sells a new 0.25%....>

GERMAN AUCTION PREVIEW
GERMAN AUCTION PREVIEW: Germany sells a new 0.25% Aug-28 bund for E4.0bln on
Wednesday.
- BACKGROUND: Germany is on target for issuance this year with 58% of the 2018
target already fulfilled. This is the auction of the new benchmark 10-year bund.
- RV/HISTORY: The German 10-year bund yield has surged higher in recent days,
trading at 0.363% from a low of 0.292% on July 6. The curve has also steepened
with the 2s10s spread widening to 102.3bps from 95.5bps over the same period.
Credit risk premia appears to be relatively stable with the 10-year CDS trading
at 23bps, down from 25bps over the past week. Inflation expectations are also
holding steady with the the 10-year breakeven holding with a 1.33-1.37 range
since the beginning of June. There are no significant EGB redemptions or coupon
payments this week to support the auction.   
- TIMING: Results are due shortly after the auction closes at 0935GMT.

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