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SSA WEEKLY: A week that never really got going, EU lined up

- The euro market never really got out of first gear despite a partial evaporation of concern surrounding French election outcomes.

- The UK election and US holidays didn t help either and, in the end, just EUR3.078bn was priced with over half of that coming from the Republic of Chile which brought a new 7yr social line.

- Rentenbank provided the only European-based benchmark issuance whilst KfW successfully placed its first EUR denominated blockchain-based digital bond (a 1.5yr EUR100m)

- In dollars, the EIB (USD4bn 7yr green) and BGK (10/30yr dual tranche) jointly dragged the overall tally to USD7.5bn with very healthy demand for the former.

New EUR deals thin on the ground

Finally getting underway after spending quite some time in the pipeline (roadshow commenced 7th May and concluded 17th June) was KfW with its debut EUR blockchain-based digital bond with a conservative 1.5yr tenor (perfect for testing the waters). The issuer appeared to dangle a 10bp carrot in front of prospective investors (price set at KfW+10bp) to ensure participation in a format which is still in its infancy.

The only European-based issuer to brave the market (loosely used given that the underlying backdrop appeared good for most of the week) for benchmark sized paper was Rentenbank. It trimmed a single bp off m/s +13a IPTs to price a EUR1.25bn (from bmk) 7yr into a EUR1.58bn. In addition, the Republic of Chile landed a EUR1.6bn sized 7yr social 25bps inside its m/s +130a starting point on an undisclosed book.

Coming with a sub-benchmark trade into the otherwise quiet market, the City of Madrid successfully priced a EUR128m long 10yr deal at SPGB+25bp. That was c10bp above an Apr 2034 maturity listed on the comps list (a rather rare thing in SSAs) from MADRID (i.e. the Autonomous Community of Madrid).

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