ECB: Knot: Two Sided Risks To Inflation; Neutral Rates A Good Place To Be

• MNI: SWEDEN APR RETAIL SALES +5.3% Y/Y

• MNI CHINA MONEY MKT INDEX MAY LQDTY OUTLOOK 51.1 VS APR 45.6
• MNI CHINA MMI CURRENT LQDTY CONDITIONS MAY 25.0 VS APR 25.6
• MNI CHINA MMI ECONOMIC CONDITIONS MAY 56.5 VS APR 62.2

Italy will look to issue a BTP Italia while there will be auctions from the Netherlands, Italy, and Germany. We also pencil in a Spanish 10-year syndication. We pencil in estimated gross issuance for the week of E31.2bln (excluding the BTP Italia), down from E42.7bln last week.

For the full document with a recap of issuance so far this week and a look ahead to the rest of this week's and next week's issuance, click here.

• Spain has announced a mandate for a new 10-year Obli maturing 31 October 2025 (in line with our expectations of a syndication this week as we set out in last week’s EGB Issuance, Redemption and Cash Flow Matrix). We pencil in a E10-15bln transaction size with a transaction today.
• This morning, Germany will come to the market to hold a 15-year Bund auction. On offer will be E1.5bln of the 1.00% May-38 Bund ISIN(DE0001102598) and E500mln of the 4.75% Jul-40 Bund (ISIN: DE0001135366).
• Italy will look to issue a 7-year BTP Italia this week, maturing 4 June 2032. This will be the first BTP Italia since March 2023 with an offering for retail investors (ISIN: IT0005648248) between Tuesday and Thursday and for institutional investors (ISIN: TBC) on Friday. As usual, the BTP Italia is linked to Italian inflation (rather than Eurozone inflation).
  • At the end of the first day, books closed in excess of E3.144bln (lower than the Day 1 book size last time).
  • The last BTP Italia launched in March 2023 had a 5-year maturity and saw E8.563bln sold to retail investors (day 1: E3.637bln; day 2: E2.933bln; day 3: E1.993bln) and E1.353bln sold to institutional investors.