Italy will come to market.....>

ITALY AUCTION PREVIEW: Italy will come to market on Wednesday for a tap of

E5.75-7.75bn. On offer are the 1.85% Jul-25 BTP, Dec-23 CCTeu, 1.65% Dec-30 BTP

and the 0.95% Aug-30 BTP.

- BACKGROUND: Previous auction results (date, volume, average yield,

bid-to-cover): 1.85% Jul-25 BTP (29 May 2020, E2.5bn, 0.91%, 1.40x), Dec-23

CCTeu (31 March 2020, E.75bn, 0.66%, 2.04x), 1.65% Dec-30 BTP (3 June 2020,

E15bn, 1.71%..new synd.), 0.95% Aug-30 BTP (29 May 2020, E4bn, 1.42%, 1.27x).

- RV/HISTORY: BTPs lacked direction at the beginning of this week, having

rallied over the course of June. Spreads over bunds have narrowed sharply over

the previous two months as the raft of monetary stimulus measures - particularly

the PEPP - has reduced idiosyncratic risk. Italy continues to see robust demand

for BTPs, with the recent syndicated issue of the 1.65% Dec-30 BTP on 3 June

attracting an order book in excess of EUR100bn. 

- TIMING: Results are due out soon after the auction closes at 1000BST.