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UK DMO UPDATE: Consultation feedback: Shorts

UK DMO UPDATE
  • 3.75% Mar-27 gilt: Strong support for one auction from both GEMMs and investors. As expected.
  • New 3-year gilt: "Nearly all" GEMMS and most investors supported 2 auctions: More GEMMs preferred a Mar-28 maturity, with others preferring an Oct-27 maturity. The Minutes give no preference from investors - with both maturity option suggested. Also as expected.
  • 4.125% Jul-29: 3 auctions had "strong support" from GEMMs and "many" investors with GEMMs unanimous at least 2 auctions. Our base case sees three auctions, our alternative scenario saw two.
  • 4.00% Oct-31 gilt: Some support for an auction amongst both GEMMs and investors after the gilt transitions into the short bucket, but some GEMMs were "more cautious about the strength of demand at this maturity. This is something we raised in the MNI Deep Dive. We only see an auction of this gilt in our alternative scenario.

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