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The Deutsche Finanzagentur...>

GERMAN AUCTION PREVIEW
GERMAN AUCTION PREVIEW: The Deutsche Finanzagentur re-opens two linkers on
Tuesday: 0.50% Apr-30 Bundei for up to E500mln and 0.10% Apr-46 Bundei for
E250mln.
- BACKGROUND: This will be the 6th linker auction in 2018 and the third tap of
the Apr-30 and Apr-46 this year. The finance ministry has already raised
E3.75bln versus a target of E6-E10bln for 2018
- RV: Since the previous auction on May 8, the real yield for both linkers has
dropped 10-20bp. The Apr-30 trades at -0.882, while the yield on the Apr-46 has
fallen to -0.607 from -0.433 on May 8. This has been driven by the sharp drop in
nominal yields with the benchmark Aug-46 trading at 1.042% from 1.200 on May 8,
while the yield on the benchmark Jan-30 bund has fallen to 0.467% from 0.615%
over the same period.
- HISTORY: Both linkers were tapped on May 8, with E0.5bln 0.50% Apr-30 sold at
real yield of -0.77% and cover of 1.94x and E0.25bln 0.10% Apr-46 sold at real
yield of -0.46% and cover of 1.69x.
- TIMING: Auction results are due shortly after bidding closes to 0930GMT

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