MNI Gilt Week Ahead: BOE to hold first temp gilt sales ops

• The week ahead will see more focus on gilt operations and announcements and external events than on UK data and speeches. In terms of data the highlight will be the BOE’s Decision Maker Panel data for November which is due for release on Thursday at 9:30GMT. We also have CBI sales, consumer credit / mortgage approvals data, Nationwide house price data and the final print of the manufacturing PMI. In terms of MPC appearances, we have an appearance from Mann on Tuesday, Governor Bailey testifying ahead of the Lords Economic Affairs Committee also Tuesday and Pill as a panellist on Wednesday. However, we heard from all of these MPC members last week, probably in more detail, so it's unlikely this week will provide anything new.
• Monday will see the BOE hold an APF sales operation for medium-dated gilts (7-20 years) and Tuesday will see the first operation to sell some of the BOE’s temporary holdings of gilts (the long-dated/linkers bought during the market turmoil in October. The operation will be “demand-led” with no set size. The Bank has set out some guiding principles: first, bids below prevailing market mid-prices at the end of the window will not be accepted. Second, the Bank “will not allocate bids for gilts in a window where the submitted price is significantly lower than the previous trading day’s close.” With these conditions in place, it is unclear at present whether there will be much demand. The operations will also take place on Wednesday and Friday (and then generally on Tuesdays, Wednesdays and Fridays going forward with the exception of the 19 December to 6 January period).
• Monday will also see the DMO hold its quarterly consultation meeting. We set out our expectations for issuance in the January to March quarter in the UK Deep Dive following the Autumn Statement here. The DMO will release its issuance calendar on Wednesday at 7:30GMT.

GiltWeekAhead20221128.pdf