The Deutsche..........>

GERMAN T-BILL AUCTION PREVIEW: The Deutsche Finanzagentur is planning to issue

up to E2bln of a new 6-month May 16, 2018 Bubill on Monday.

- BACKGROUND: Yields have squeezed lower since mid-Oct as ECB extended its QE

programme for 9-mths at least and hints rates will remain lower for longer.

- RV: The grey market for the new May 16, 2018 Bubill is indicating a mid-yield

of around -0.766% according to Tradeweb and is a pick up of 0.4bp vs Apr 11,

2018 Bubill. Compared to Eonia, 6-month Eonia is currently seen at -0.357%,

giving a spread of -40.9bp. This compares to a spread of a -37.7p seen at the

last 6-month Bubill auction.

- HISTORY: At last 6-month Bubill auction on Oct 9, the finance ministry sold

E1.015bln at average yield -0.7322%, cover of 2.2 times and E985mln or 49.25%

retained for secondary market operations. Prior to this on Sep 11 E1.663bln was

sold at average yield -0.7661%, cover of 2 times and 16.85% retained. 

- REDEMPTION: There will be a Bubill redemption of E2.0bln this week, therefore

leaves net cash flow flat, which is seen underpinning demand.

- TIMING: Results due to be announced shortly after bidding closes at 1030GMT.