Spain taps 3-year 0.05% Jan...>

SPAIN AUCTION PREVIEW: Spain taps 3-year 0.05% Jan 2021 Bono, 10-year 1.40% Apr

2028 SPGB and 50-year 3.45% July 2066 SPGB for between E3.5-E4.5bln Thursday.

Spain also re-open 3-yr 0.30% Nov 2021 Bono linker for between E0.5-E1.0bln  

- BACKGROUND: Curve have steepened in last couple of weeks but Spanish bonds

remain close to tightest level vs German Bunds. Spain redemption of E16.82bln

and coupons of E5.33bln are seen helping though.

- RV/HISTORY: 10-yr Spanish debt has cheapened versus the German Bund in the

last few days and is currently seen at 73.4bps having hit ytd low of 64.4bps

last week. The 2-10Y section of the Spanish curve has steepened by circa 6.5bps

after hitting tightest level 2-weeks ago. While the 10-50Y has steepened by

around 4bps in the same time, which might help the bid for the 2066 Bond. The

Jan-21 was last sold at a yield of -0.23% and cover 3.08x, the Apr-28 yielded

1.24% and cover 1.3x and the Jul-66 yielded 3.19% and cover 1.54x. The Nov-21

Bonoei is being tapped for first time this year, but has sharply outperformed

Jul-21 Bono since March but remains mid-range vs 2-yr BTPei. 

- RESULTS: Auction bidding closes at 0830GMT with results around 0840GMT