EUROZONE ISSUANCE: EGB Supply – W/C 6 October
- Germany will return to the market on Wednesday 8 October to hold a 15-year Bund auction with E1bln of each of the 2.60% May-41 Bund (ISIN: DE000BU2F009) and the E1bln of the 3.25% Jul-42 Bund (ISIN: DE0001135432) on offer.
- Ireland will hold its only Q4 auction on Thursday 9 October, with details to be confirmed on Monday 6 October. Every auction so far this year has seen the 10-year 2.60% Oct-34 IGB (ISIN: IE000LQ7YWY4) on offer as either the only line or as a dual-line auction. The three auctions held so far have had sizes of E1.00bln, E1.25bln and E1.50bln respectively; we would expect the size of this auction to remain within that range.
NOMINAL FLOWS: The week ahead will see redemptions of E36.1bln, E27.5bln from a German conventional Bobl and E8.5bln from a German green Bobl. Coupon payments for the week total E3.5bln of which E3.4bln are from the EU. This leaves estimated net flows for the week at negative E21.7bln, versus positive E3.5bln this week.
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US 10YR FUTURE TECHS: (Z5) Pullback Appears Corrective
- RES 4: 113-06 2.236 proj of the Jul 15 - 22 - 28 price swing
- RES 3: 113-00 Round number resistance
- RES 2: 112-28+ 2.000 proj of the Jul 15 - 22 - 28 price swing
- RES 1: 112-19/20+ High Sep 3 / Aug 28 / 29
- PRICE: 112-18 @ 16:58 BST Sep 3
- SUP 1: 111-31+ 20-day EMA
- SUP 2: 111-19 50-day EMA
- SUP 3: 111-13+ Low Aug 18 and a key support
- SUP 4: 110-25 Low Aug 1
The trend outlook in Treasury futures is bullish and the latest pullback appears corrective. Recent gains delivered a print above 112-15+, the Aug 5 high and a bull trigger. A breach of this hurdle confirms a resumption of the current bull cycle and signals scope for an extension towards the 113-00 handle. Moving average studies are in a bull-mode position, reinforcing a bull theme. First support to watch is 111-31+, the 20-day EMA.
SECURITY: Trump To Speak w/Zelenskyy And Euro Leaders After Ukraine Summit Thurs
The Elysee confirmed that French President Emmanuel Macron, Ukrainian President Volodymyr Zelenskyy and ‘several other heads of state’ will speak with President Donald Trump at 08:00 ET 13:00 BST tomorrow, after a meeting of the ‘Coalition of the Willing’ in Paris.
- Trump said alongside Polish President Karol Nawrocki in the Oval Office that roughly 10,000 US soldiers will remain deployed in Poland, adding that number could be increased "if they want".
- Zelenskyy confirmed a short time ago that he discussed a US backstop to security guarantees w/EU counterparts in Copenhagen today: “We have signals from the US of a possible backstop [and] the role of EU membership in this holistic system of security guarantees...”
- Trump reiterated to reporters yesterday that there will be “consequences” for Putin slow-walking a meeting with Zelenskyy. He added: “I had actually a very good meeting with [Putin] a couple of weeks ago. We'll see if anything comes out of it. If it doesn't, we'll take a different stance.”
- It is unlikely Putin's recent concessions on a meeting will be seen by the White House as sufficient progress. See SECURITY: Putin Offers To Meet Zelenskyy And Trump In Moscow
- Treasury Secretary Scott Bessent told Fox on Monday that “all options are on the table” for further sanctions on Russia, adding “we’ll be examining those very closely this week.”
- Bessent and White House officials said EU countries need to align with the US on halting Russian oil purchases, but have equivocated on pursuing a similar secondary oil tariff on China to the one imposed on India.
- US Ambassador to NATO, Matthew Whitaker, told Bloomberg yesterday that the US has refrained from imposing secondary sanctions on China because of ongoing trade negotiations.
EGB SYNDICATION: Lithuania Long 10 / 20-year LITHUN: Priced
Long 10-year:
- Reoffer: 99.698 to yield 3.662%
- Spread set at MS + 95bp (Guidance was MS+105bp area and revised to MS + 95-100bp (WPIR))
- Size: E1.0bln (in line with MNI estimate)
- Books closed in excess of E1.9bln (ex JLM interest)
- Maturity: 10 March 2036
- Coupon: 3.625%, Short first
- HR 100% vs 2.60% Aug-35 Bund. Spot ref 98.76 / + 91.9bp
- ISIN: XS3175946071
20-year:
- Spread set earlier at MS +140bp (guidance was MS+145bp area)
- Size: E750mln (MNI pencilled in E1bln)
- Books closed in excess of E1.6bln (ex JLM interest)
- Maturity: 10 September 2045
- Coupon: 4.25%
- HR 99% vs 2.50% July-44 Bund. Spot ref 90.23 / + 116.5bp
- ISIN: XS3175947046
For both:
- Bookrunners: Erste Group (B&D), HSBC and Societe Generale
- Settlement Date: 10 September 2025 (T+5)
- Timing: TOE: 16:24 BST /17:24 CET. FTT immediately.
From market source / MNI colour
