The Belgian debt agency.....>

BELGIUM AUCTION PREVIEW: The Belgian debt agency taps E2.3-2.8bln of OLO 0.2%

Oct-23, 4.5% Mar-26 and OLO 1.6% Jun-47 today. 

- BACKGROUND: There are near E50bln of French coupon and redemption payments on

Wednesday that will help this Belgian auction. Belgium has issued E32.3bln in

2017 compared to a E35bln target, so today's issuance will likely complete the

official OLO target, although foreign currency/structured issuance is E2.5bln

short of target, thereby allowing OLO issuance overshoot. 

- RV/HISTORY: Generally-speaking, the Belgian curve trades expensive (using

swaps spreads) to France and Austria in the 2-5Y part of the curve but cheapens

to these credits in the 6-10Y. The OLO 0.2% Oct-23 looks much cheaper to France

than say 2020-2022 bonds and is short enough in maturity to benefit from the

massive French coupon payments. The OLO 4.5% Mar-26 is old and likely a request

from the Primary Dealer. It looks expensive on the curve. The 1.6% Jun-47 asset

swaps more expensive than the, admittedly less liquid, OLO 3.375% Jun-45.

- RESULTS: Auction results are due around 1010GMT.