{"id":31091,"date":"2025-06-17T12:12:53","date_gmt":"2025-06-17T12:12:53","guid":{"rendered":"https:\/\/financialrush.com\/?p=31091"},"modified":"2025-06-17T12:12:53","modified_gmt":"2025-06-17T12:12:53","slug":"era-of-bund-scarcity-is-over-says-german-debt-chief","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=31091","title":{"rendered":"Era of Bund scarcity is over, says German debt chief"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<p>Stay informed with free updates<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\"><span>Simply sign up to the <!-- -->Eurozone economy<!-- --> myFT Digest &#8212; delivered directly to your inbox.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=97659dba-6cca-4d4f-82ed-ae4bf3e45308&amp;concept-id=248d873c-6689-4764-bede-cab061889217\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>The era of Bund scarcity is \u201cdefinitely over\u201d, said a senior German official, as the Eurozone\u2019s safest borrower increases sales of its benchmark debt to fund a defence and infrastructure spending spree.<\/p>\n<p>Tammo Diemer, an executive board member at <a href=\"https:\/\/www.ft.com\/germany\" data-trackable=\"link\">Germany<\/a>\u2019s finance agency who oversees its sovereign debt issuance, pointed to the increasing availability of German bonds in the secondary market following the end of quantitative easing.\u00a0<\/p>\n<p>\u201cScarcity of Bunds is definitely over,\u201d he told delegates at the Financial Times\u2019 Global Borrowers &amp; Bond Investors Forum in London. \u201cThere are only a number of securities where there is still shortness in the market.\u201d<\/p>\n<p>The constitutional limit on Germany\u2019s debt level has contributed to the country\u2019s status as the <a href=\"https:\/\/www.ft.com\/eurozone-economy\" data-trackable=\"link\">Eurozone<\/a>\u2019s safest borrower and historically created a shortage of its debt that suppressed its borrowing costs. Bunds provide a benchmark against which other countries\u2019 creditworthiness is viewed.<\/p>\n<p>The end to the European Central Bank\u2019s bond-buying programmes, which had bought up huge amounts of Bunds and other government debt during previous crises, was a major driver of the greater availability, he added.<\/p>\n<p>Germany\u2019s borrowing costs <a href=\"https:\/\/www.ft.com\/content\/1886054a-3ff3-4186-bcf9-8dba9b206a56\" data-trackable=\"link\">jumped<\/a> in March in their biggest one-day move since 1997 after it announced a \u20ac1tn spending package that exempted defence spending from its constitutional debt brake.<\/p>\n<figure class=\"n-content-image n-content-image--full\" data-component=\"image-set\"><picture><source media=\"(min-width: 700px)\" srcset=\"https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3Acf09de9e-4e6b-4f80-8c35-73c865db21c2?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=1 1x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3Acf09de9e-4e6b-4f80-8c35-73c865db21c2?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=2 2x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3Acf09de9e-4e6b-4f80-8c35-73c865db21c2?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=3 3x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3Acf09de9e-4e6b-4f80-8c35-73c865db21c2?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=4 4x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3Acf09de9e-4e6b-4f80-8c35-73c865db21c2?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=700&amp;dpr=5 5x\" width=\"3500\" height=\"2500\"\/><source media=\"(max-width: 490px)\" srcset=\"https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A6127ad88-2623-4253-98e5-010796ba238c?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=1 1x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A6127ad88-2623-4253-98e5-010796ba238c?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=2 2x,https:\/\/www.ft.com\/__origami\/service\/image\/v2\/images\/raw\/ftcms%3A6127ad88-2623-4253-98e5-010796ba238c?source=next-article&amp;fit=scale-down&amp;quality=highest&amp;width=490&amp;dpr=3 3x\" width=\"1500\" height=\"2000\"\/><\/picture><\/figure>\n<p>Underlining the normalisation in the market, Diemer pointed to German bond yields moving above interest rate swaps of the same duration, which <a href=\"https:\/\/www.ft.com\/content\/cbc6cbb8-a91c-48b5-922e-ca5246956b2b\" data-trackable=\"link\">happened<\/a> for the first time last year as expectations mounted over debt brake reform. <\/p>\n<p>Speakers at the event also pointed to growing interest among global investors in AAA-rated euro debt as an alternative to dollar assets, amid broad doubts over the greenback\u2019s haven status.<\/p>\n<p>Siegfried Ruhl, from the Directorate-General for Budget of the European Commission, which manages common EU issuance, said turbulence in dollar markets had attracted investors to common EU debt.<\/p>\n<p>\u201cWe are seeing increased interest\u2009.\u2009.\u2009.\u2009We see new names in our [debt syndications] from countries or regions which are typically very dollar-based,\u201d he said, adding that they were also meeting requests from global investors. \u201cAt the moment it is an opportunity for Europe to strengthen its position [in the] global capital markets.\u201d\u00a0<\/p>\n<p>Ruhl said the introduction of EU debt into sovereign bond indices, which has not yet happened, would be crucial to the development of the asset class.<\/p>\n<p>Separately, officials responsible for issuing sovereign debt for other Eurozone borrowers, such as Ireland and Portugal, said there had been interest from foreign issuers looking to diversify away from dollar assets.<\/p>\n<p>\u201cIt has definitely helped [the] spread compression\u201d between Eurozone governments and Germany\u2019s benchmark debt, said Dave McEvoy at Ireland\u2019s National Treasury Management Agency.<\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/97659dba-6cca-4d4f-82ed-ae4bf3e45308\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Stay informed with free updates Simply sign up to the Eurozone economy myFT Digest &#8212; delivered directly to&hellip;\n","protected":false},"author":6,"featured_media":31092,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":["post-31091","post","type-post","status-publish","format-standard","has-post-thumbnail","category-us","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/31091","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=31091"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/31091\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/31092"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=31091"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=31091"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=31091"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}