Italy re-opens CTZ 0%.........>

ITALY AUCTION PREVIEW:  Italy re-opens CTZ 0% May-19 for between E1.5-2.0bln on

Monday

- BACKGROUND: With Italian debt slightly on the back foot in the past couple of

weeks and especially following numerous articles on possible parallel 

currencies, combined with an illiquid bond market, today's CTZ auction is seen

as a little test. Saying that though yields have built in a decent 5bp

concession ahead of todays auction.

- RV/HISTORY: The CTZ May-19 and trades a generous around 15bp cheaper to

swaps than the BTP 0.1% Apr-19, more than enough to compensate for the

additional haircut for zero coupon bonds that the ECB demands, and most generous

since the CTZ was first issued. The previous auction saw a cover of 1.64x at a

yield of -0.16%, the secondary yield today is -0.068% according to Tradeweb.

- TIMING: Auction cut-off is 0900GMT/1000BST, results are around 0920GMT.