Modest bid. Today’s 20y MGS 5/35 reopening auction drew a bid/cover of 2.154x on a slightly larger-than-expected MYR2b size. The bid/cover is considered modest, faring better than the previous two auctions (3.

Results: MGS 5/35 Reopening

·         Modest bid. Today’s 20y MGS 5/35 reopening auction drew a bid/cover of 2.154x on a slightly larger-than-expected MYR2b size. The bid/cover is considered modest, faring better than the previous two auctions (3.5y GII 2.07x and 10y GII 2.02x) but worse than the YTD average of 2.385x in the 15y-30y tenor bracket. Demand was primarily local driven although some foreign bids were noted.

·         Successful yields averaged 4.295% and cut-off yield was 4.318%, both tailed the pre-auction WI of around 4.29/27. Post-auction sentiment remained tepid with trades mostly done at levels between the highest and average yield of this auction.

·         Next auction is the reopening of 7y GII 7/23. We estimate a size of MYR2.5b.

Bid to cover:            2.154

Highest yield:           4.318%

Average yield:         4.295%

Lowest yield:           4.250%