EM CEEMEA CREDIT: Kenya: Dec Inflation Stats

• Belgium has opened books on its latest Bons d' Etat issue. In the first three days (through last Thursday), books were E151.79mln. This compares favourably to the E117.4mln raised through the third day of subscription last time in late August. Across lines, Belgium raised E122.82mln of the new 2.00% 1-year Dec-2026 Bons d' Etat (ISIN: BE3871308388) and E28.98mln of the new 10-year Dec-2035 Bons d' Etat (ISIN: BE3871309394). The subscription period for the issue ends tomorrow.

NOMINAL FLOWS: This week will see a redemption of E18.4bln from a formerly 10-year BTP. Coupon payments for the week total E7.5bln of which E2.7bln are from the EU, E2.6bln are Spanish and E2.1bln Italian. This leaves estimated net flows for the week at negative E7.3bln, versus negative E15.9bln last week.

• RES 4: 5825.00 High Nov 13 and a key resistance      
• RES 3: 5742.40 76.4% retracement of the Nov 13 - 21 bear leg
• RES 2: 5691.30 61.8% retracement of the Nov 13 - 21 bear leg  
• RES 1: 5688.00 High Nov 28          
• PRICE: 5657.00 @ 06:33 GMT Dec 1
• SUP 1: 5602.97/5475.00 50-day EMA / Low Nov 21 and bear trigger     
• SUP 2: 5427.01 61.8% retracement of the Aug 1 - Nov 13 bull cycle  
• SUP 3: 5383.00 Low Sep 18 
• SUP 4: 5366.00 Low Sep 17      

The move higher in EUROSTOXX 50 futures last week undermines a recent bearish theme and the contract is holding on to most of its gains. Price has traded above the 20- and 50-day EMAs, signalling scope for a stronger recovery near-term. A continuation would open 5691.30 and 5742.40, Fibonacci retracement points. For bears, a reversal lower would instead expose the key S/T support and bear trigger at 5475.00, the Nov 21 low.

The EU, Germany, Spain and France will all look to hold auctions this week while Belgium will continue to sell its retail Bons d’Etat. We pencil in issuance of E18.6bln for the week (ex retail), down from E25.3bln last week. We also see the potential for another Italian buyback, but do not include that in our central expectation.

See the full document here for a look ahead to the next two weeks of issuance and a recap of last week.

• The EU will kick off issuance for the week today with its final EU-bond auction of 2025, with up to E2bln of the 0% Oct-28 EU-bond (ISIN: EU000A3KWCF4), up to E2bln of the 2.75% Dec-32 EU-bond (ISIN: EU000A4ED0K0), and up to E1bln of the 0.45% Jul-41 EU-bond (ISIN: EU000A3KT6B1) on offer.
• Germany will draw its 2025 capital markets issuance to a close tomorrow with E4.5bln of the 2.00% Dec-27 Schatz (ISIN: DE000BU22114) on offer.
• Spain will then hold its final auction of the year on Thursday to hold a Bono/Obli/ObliEi auction. The 2.70% Jan-30 Bono (ISIN: ES0000012O00), the 0.85% Jul-37 Obli (ISIN: ES0000012I24) and the 1.15% Nov-36 Obli-Ei (ISIN: ES0000012O18) will be on offer. We pencil in a maximum nominal issuance of around E3-4bln with the target range for the 1.15% Nov-36 Obli-Ei likely E250-750mln. The auction size will be announced today.
• France will also conclude its issuance for the year on Thursday with a LT OAT auction (despite being eligible to sell MT/LT/IL OATs in the last auction of the year). On offer will be a combined E3.5-5.5bln of the 4.75% Apr-35 OAT (ISIN: FR0010070060), the 0.50% May-40 OAT (ISIN: FR0013515806), the 4.50% Apr-41 OAT (ISIN: FR0010773192) and the 3.25% May-55 OAT (ISIN: FR001400OHF4).