Mins Of DMO Meeting With GEMMS & Investors Point To 20-Year Syndi In Q4, Mixed Views On I/L

The DMO has published the minutes of its meeting with GEMMS and Gilt investors (held yesterday).

• The DMO indicated that it is currently planning to hold one syndicated transaction of a conventional gilt and could also consider the scheduling of an index-linked syndication in the next quarter (as expected).
• The DMO will announce details of the full gilt operations calendar for October to December 2023 at 7:30am on Thursday 31 August 2023.

GEMMS:

• There was almost unanimous support for the launch of a new 20-year gilt, with the most popular maturity being in 2043. There was also an isolated call for the launch of a new 10-year gilt via syndication.
• Around half of attendees expressed support for the scheduling of an index-linked gilt syndication in the quarter. Views on the timing of such a transaction were split between October and November, with the latter noted to coincide with index-linked gilt coupon payments. Recommendations for the choice of gilt that might be sold included the launch of a new 30-year index-linked gilt (potentially maturing in 2054), as well as re-openings of IL 2045 and IL 2073.

• Those attendees who expressed a view generally recommended the launch of a new 20-year conventional gilt, with a 2043 maturity preferred by most.
• Mixed views were provided on an index-linked gilt syndication, with a number preferring that an index-linked syndication take place in Q4 2023-24, rather than in the third quarter of the financial year. However, others expressed the view that there was a case for holding an index-linked syndication in Q3 2023-24, given reinvestment into index-linked gilts from coupon payments in November. A range of potential maturities were suggested for re-opening, including IL 2039, IL 2051 and IL 2073.