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Germany Will Offer E5.0bn of the 0% Dec-22 Schatz on Tuesday


Germany will come to market on Tuesday for a tap of E5bn. On offer is the 0% Dec-22 Schatz.

  • BACKROUND: The 0% Dec-22 Schatz is a new offering with a subsequent E3bn tap schedule for December 9.
  • RV/HISTORY: Bunds sold off and the curve bear steepened in the immediate aftermath of the news that Pfizer had developed an effective Covid vaccine, with yields drifting lower into the end of last week. Monday's announcement from Moderna that it has a vaccine which is 94.5% effective similarly initially pushed up bund yields before falling back on signs that the ECB's asset purchases have picked up and comments from the ECBs De Cos suggesting that new stimulus should focus on bond purchases. It is likely that the vaccine developments will remain supportive of broader risk sentiment and weigh on bunds heading into the Tuesday auction.
  • TIMING: Results are due out shortly after the auction closes at 1030GMT.

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