Germany will tap the 0.0%....>

GERMAN AUCTION PREVIEW: Germany will tap the 0.0% Jun-21 Schatz for E4bln today.

- BACKGROUND: The 0.0% Jun-21 Schatz was last sold on May 28 with E3.91bln

allotted at an average yield of -0.65% and Buba cover of 1.60

- RV/HISTORY: Having sold off during the first half of July following a

multi-month rally, German bunds have subsequently reclaimed losses with yields

at the very long end now making fresh record lows. The curve has similarly

flattened, with 2s10s trading at 36bps and returning to 2015 levels. The 0.0%

Jun-21 Schatz serves as the 2-year benchmark and currently trades at -0.760%,

down from a YTD high of -0.503% in March and 35.5bp inside the comparable EUR

swap. Ahead of today's auction the German regional CPI prints for July will be

published. Saxony has already released (1.6% Y/Y down from 1.8% the previous

month) and will be followed by Baden Wuerttemberg (0845), Brandenburg, Hesse and

Bavaria (0900) and North Rhine Westphalia (0930). The headline national print

will be released at 1300 after today's auction has closed.

- TIMING: Results are due out shortly after the auction closes at 1030 London

time.