This morning at 7:30BST, the DMO will.........>

GILTS: This morning at 7:30BST, the DMO will release an update of its gilt remit

for 2020/21.

- We note that a Bloomberg survey of primary dealers sees the median estimate

for July to September issuance at GBP132bln with GBP412bln for the whole fiscal

2020/21 year. Through the first three months of the fiscal year the DMO has

issued GBP181.2bln and its last remit update covered the April to July period

where it set a target of GBP225bln.

- This would mean that consensus is therefore looking for issuance to be just

under GBP100bln for the second half of the fiscal year (October to March).

- On a monthly profile basis, this would suggest the market expected around

GBP60bln of issuance in July, around GBP36bln in each of August and September

(or GBP44bln in each of July, August and September). And then around GBP17bln

per month through the second half of the fiscal year.

- For reference, the original remit estimate from the DMO from the 11 March

budget (i.e. before Covid measures were included) was GBP156.1bln for the entire

2020/21 fiscal year - a run rate of about GBP13bln per month. (1/2)