/PORTUGAL AUCTION PREVIEW: The....>

EUROZONE ISSUANCE: /PORTUGAL AUCTION PREVIEW: The Instituto de Gestao de Credito

Publico (IGCP) re-opens the 5-yr 4.95% Oct-23 PGB and 10-yr 2.125% Oct-28 PGB

Wednesday. Expected issuance is between E1-1.25bln.

- BACKGROUND: This will be the third Portuguese auction this year, and including

two syndication deals, Portugal has already raised E9.5bln of planned E15bln

issuance in 2018. This will be the third tap of the Oct-28, following Feb and

Mar, and since the issue`s syndicated launch in Jan. It is the first tap since

2016 of the Oct-23 which was launched in 2008 as a 15-year, but the previous

5-year benchmark (Oct-22) yielded 0.58% at auction on Feb 14.

- RV/HISTORY: Portugal continues to enjoy improved market conditions alongside

domestic macro improvement and low benchmark yields. Long-end yields are near

all-time lows and spreads vs Germany are near decade lows. The 10-year spread

over Bunds, at 117bps, is up about 13bps from the Apr 24 low but around the same

as going into the March auction, with yield now lower at 1.736% vs 1.804%. The

5-year Oct-23 spread over Bunds is up about 8bps from the Apr low, at 66bps.

- TIMING: Auction results are due shortly after bidding closes at 0935GMT.