On Nov 13 Dipartimento del....>

ITALY AUCTION PREVIEW: On Nov 13 Dipartimento del Tesoro tap the market for a

combined E4.0bln-E5.5bln. On offer are the reopened; 2.30% Oct-21 BTP for

E2.0-E2.5bln, 2.50% Nov-25 BTP for E1.25-E1.75bln, 2.95% Sep-38 BTP for

E0.75-E1.25bln.

- HISTORY: At the last openings of the 2.30% Oct-21 BTP and the 2.50% Nov-25 BTP

on Oct 11, Italy allotted E3.5bln of the 2.30% Oct-21 BTP at an average yield of

2.51% with a cover of 1.26x, and E1.5bln of the 2.50% Nov-25 BTP at an average

yield of 3.28% with a cover of 1.9x.

At the last auction of the 2.95% Sep-38 BTP on Jul 12, Italy allotted E1.25bln

at an average yield of 3.28% with a cover of 1.44x.

- RV/BACKGROUND: Italian BTPs sold-off in the morning of Nov 12 but stabilised

by midday with the 2-year trading at 0.999% off a high of 1.024%. The longer-end

has outperformed and the curve has flattened on the day. Italy are meant to

present their revised budget to the EU on Nov 13, although it is likely to be

rejected again.

- TIMING: Results are due shortly after the auction closes at 0920GMT.