Spain taps 5-year 0.45% Oct...>

SPAIN AUCTION PREVIEW: Spain taps 5-year 0.45% Oct 2022 Bono, 10-year 1.40% Apr

2028 Obli and 15-year 2.35% July 2033 Obli for between E4-E5bln Thursday. 

- BACKGROUND: With improving fundamentals, non-residents are apt to buy Bonos,

although the 24.5% and rising held by Bank of Spain, means that foreign buyers

struggle to find sellers. 

- RV/HISTORY: Spanish debt markets are trading at the tight end of their range

to Germany at 69bp. The 5-10Y section of the Spanish curve has continued to

flatten since the end of March while there has been a mild flattening between

Apr-28 and Jul-33 over the past week, which might weigh slightly on the bid for

the 2033. As for the Oct-22, the yield spread to German 5-yr Bobl has tightened

by over 3bp this week while the Jul-33 has tightened by 10bps vs the 4.75%

Jul-34 Bund. The Oct-22 was last sold at a yield of 0.29% and cover 1.45x, the

Apr-28 yielded 1.36% and cover 1.28x and the Jul-33 yielded 1.88% and cover

1.64x.  

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