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France set to issue to new 50-year bond in coming days Belgium, Spain, other possible candidates for 50-year issuance EMs skewed long-bond issuance towards ultra-longs in 2020 Don’t rule out 100-year Italy bond - analyst
LONDON, Jan 18 (Reuters) - More governments are selling bonds that mature in 30, 50 and even 100 years’ time, capitalising on rock-bottom borrowing costs and a willingness among investors to look past risks for the sake of slightly higher yields.
After Germany’s state of North Rhine Westphalia (NRW) raised 2 billion euros on Jan. 5 via a 100-year issue, France said on Monday it would soon sell a 50-year bond, its first new debt at that maturity since 2016.
5 Min Read
LONDON (Reuters) - More governments are selling bonds that mature in 30, 50 and even 100 years’ time, capitalising on rock-bottom borrowing costs and a willingness among investors to look past risks for the sake of slightly higher yields.
After Germany’s state of North Rhine Westphalia (NRW) raised 2 billion euros on Jan. 5 via a 100-year issue, France said on Monday it would soon sell a 50-year bond, its first new debt at that maturity since 2016.
A brisk start that has also seen Mexico and Indonesia sell 50-year bonds could mean issuance volumes approach levels seen in 2016, when euro zone governments sold a record 19 billion euros of bonds with maturities of 30 years and over.
By Burhan Khadbai
17 Dec 2020
The EU began its evolution in 2020 in becoming one of the largest issuers in the capital markets. While it was plain sailing for the first few deals, there are bigger tests ahead in 2021, with the EU’s borrowing set to balloon even further in size. Burhan Khadbai reports.
The European Union has not traditionally been a big borrower. In the past several years before 2020, it consistently raised well under €10bn a year. But the coronavirus pandemic has changed all that.
In 2020, the EU raised a whopping €39.5bn for its Support to Mitigate Unemployment Risks in an Emergency (SURE) funding programme alone, which provides loans to EU member states to address sudden increases in public expenditure and help protect jobs.