POWER: Island Green Power Opens Consultation on 500MW East Pye Solar Project

• Size: E4.999bln (MNI had assumed takeup at the top of the E4-5bln target range)
• Cut off spread 2.90% Aug-54 Bund + 20bps
• Prelim initial spread guidance yesterday was +18.5 to 22.5bps then revised to 19.5 to 22.5bps as books opened then 19.5 to 21.0bps. Final guidance was + 20 to 21bps
• Final book: E32.739bln
• Allocated to real money: 85.77%
• Allocated to other: 14.23%
• Allocation at the cut-off spread: Real money: 44.00%, other: 3.61%
• Maturity: 15 January 2056
• ISIN: NL0015002P70
• Books closed, pricing today

• RES 4: $3909.4 - 2.000 proj of the May 15 - Jun 16 - 30 price swing
• RES 3: $3831.4 - 1.764 proj of the Dec 30 ’24 - Apr 3 - 7 price swing
• RES 2: $3800.0 - Round number resistance
• RES 1: $3791.1 - Intraday high             
• PRICE: $3786.7 @ 10:28 BST Sep 23
• SUP 1: $3683.8 - Low Sep 22  
• SUP 2: $3594.0 - 20-day EMA
• SUP 3: $3484.2 - 50-day EMA
• SUP 4: $3311.6 - Low Aug 20  

Gold is in a clear bull cycle and shallow short-term pullbacks remain corrective. A fresh all-time high once again, yesterday and today, confirms a resumption of the primary uptrend and an extension of the sequence of higher highs and higher lows. The next objective is the $3800.0 handle. Initial firm support lies at $3594.0, the 20-day EMA. Note that moving average studies are in a bull-mode position, highlighting a dominant uptrend.

Gilts have moved away from session highs after this morning’s 30-Year auction results extended the recent trend of softening demand for long end UK paper (see recent bullets for greater detail), owing to ongoing focus on the UK’s fiscal deterioration.

• Softer-than-expected PMI data pushed gilts to session highs ahead of the auction.
• Futures last +11 at 90.92 (90.75-91.06 range).
• Yields 2.0-3.5bp lower, curve bull flattens, last week’s lows in 2s10s and 5s30s are ~5bp away and remain untested.
• SONIA futures flat to +1.5.
• BoE-dated OIS flat to 2.5bp more dovish on the day, showing 6bp of easing through year-end, with the next cut still not fully discounted until the end of the April MPC. Market still trades at the hawkish end of the recent range and we think underappreciates the odds of a cut through year-end.
• The caveat to that is that the PMIs noted a "solid rise in prices changed in September." That won't sound very appealing to the swing members on the MPC ahead of the Q4 decisions and will be limiting the reaction in the very front of the GBP STIR strips. Recall that we will hear from both Breeden and Ramsden in speeches in the first half of next week.
• Comments from BoE chief economist Pill are ongoing, nothing market moving from him yet.