BELGIUM T-BILL AUCTION PREVIEW: On offer next week

ECB's Nagel speaks today in Tübingen on the topic of "Target achieved, but challenges still remain – monetary policy since the 2021 strategy review" - his comments appear to be seen in conjunction with the ECB's strategy review published last Monday. Key highlights below:

• "We need to be prepared for price developments to become more volatile in general. I am afraid that heightened uncertainty will become the new normal. And a number of structural developments suggest that price pressures will remain elevated over the medium term."
• "With the recent experiences in mind, I am convinced that the use of large-scale asset purchases should remain the absolute exception."
• "Although this is not the time for rate forward guidance, forward guidance remains in our toolbox. The same is true for the other instruments, notably large-scale asset purchases and targeted longer-term refinancing operations. However, we will usually use these tools only at the lower bound of interest rates, where they have proven to be useful."
• "We will therefore aim to formulate forward guidance in more flexible terms. A state-dependent formulation would help in this regard. State-dependent forward guidance means that it is tied to certain economic conditions, for instance an inflation threshold, and not to a specific schedule. It makes it clear under what circumstances monetary policy will deviate from an announced path."

• GBP1.125bln have been on offer.
• This leaves GBP35.127bln of the gilt in issue.

• US Data/Speaker Calendar (prior, estimate)
• 07/09 0700 MBA Mortgage Applications reported 9.4% from 2.7% prior
• 07/09 1000 Wholesale Trade Sales MoM (0.1%, 0.2%)
• 07/09 1000 Wholesale Inventories MoM (-0.3%, -0.3%)
• 07/09 1130 US Tsy $65B 17W bill auction
• 07/09 1300 US Tsy $39B 10Y note auction R/O (91282CNC1)
• 07/09 1400 FOMC Meeting Minutes for June
• Source: Bloomberg Finance L.P. / MNI