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Germany withdraws linkers from sale

EUROZONE ISSUANCE
  • Germany announced on Wednesday (see earlier bullet) that it would no longer be issuing inflation-linked Bunds from 2024 onwards, although the currently issued E66.25bln would remain tradable on the market.
  • At the time of writing there was no official rationale given, but we assume it is to do with the extra costs for Deutsche Finanzagentur: at time of low and stable inflation linkers are not really any cheaper to issue than conventional debt, but in times of inflation they are hugely more expensive.
  • The German linker market was also the smaller than that of France and Italy, and slightly smaller than Spain, with the German market accounting for around 13% of the euro sovereign linker market.
  • The full press release is here.

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