HALISTER1: AUCTION PREVIEW: German Taps 5Y, Covered Auction Expected

AUCTION PREVIEW: German Taps 5Y, Covered Auction Expected

(Bloomberg) -- Germany will re-open the OBL April 2021 for the 2nd time, again by EU4b at 11:30am CET.
  • UniCredit (Luca Cazzulani)
    • Last week, Germany sold EU1b of Aug. 2046 where demand was weak and the auction was technically uncovered
    • However, so far, interest for the 5y has been solid where Germany sold the 5y in early March at a yield of -0.36%
    • OBL April 2021 currently trades at -0.30%, slightly less expensive than at the last auction
  • Commerzbank (David Schnautz)
    • Expect covered German auction that stands a small chance of scoring a fresh record low yield for a nominal OBL auction, with -0.36% from the first tap the level to beat
  • UBS (Nishay Patel)
    • 5y German yields remain close to the record lows, have risen only slightly since the last auction
    • 2s5s Germany is close to the flatter end of 1-yr range of values
    • 5y Germany has cheapened on the 3s5s7s fly over the last 2-wks from the richer end of 9-mo. range and trades close to the mid-range
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
3413Z GR (Federal Republic of Germany)

People
Luca Cazzulani (UniCredit SpA)
David Schnautz (Commerzbank AG)
Nishay Patel (UBS Global Asset Management Japan Ltd)

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