German Sovereign

FMS Wertmanagement is set to dip into the market for the third time this summer, as it seeks to meet an increased funding target for the year.

Public sector bond supply this week is so far thin on the ground, despite conditions calming after fears of a conflict between the US and North Korea fell. The only supply on Monday came from a German issuer, despite some analysts pointing to a “mild risk-on tone” in eurozone debt markets.

September is fast approaching, bringing with it one of the most hotly anticipated European Central Bank (ECB) meetings ever, but the central bank will do its utmost to avoid causing drama, say investors.

FMS Wertmanagement has upped its funding requirement for 2017 by more than 50%, a move that is likely to gladden SSA bankers who are expecting a bunfight for mandates come late summer.

The public sector dollar market looks set to enjoy healthy flows for the rest of the summer, with some small deals lined up and geopolitical tensions failing to cause any large disturbances to rates.

Inflammatory rhetoric between the US president and North Korea failed to disturb rates markets on Wednesday. FMS Wertmanagement on Wednesday brought a tightly priced deal that drew heavy central bank demand — although it fell “just a touch” under full subscription.

NRW.Bank racked up another tightly priced deal for the dollar SSA market on Tuesday, as FMS Wertmanagement prepared a trade that bankers expect to attract a similar central bank audience. Issuers are enjoying strong summer dollar conditions, with swap spreads stable and US Treasury spreads attractive for the buy-side.

KfW raised €1bn with a tap of a September 2032 line on Monday, hitting screens early on Monday morning and taking advantage of a good window with a one day execution.

NRW.Bank has announced a three year dollar benchmark, picking banks for what looks to be this week’s only supply, according to one head of SSA syndicate away from the trade.

The scores are in. The BondMarker voters have delivered their verdict on Greece's long-awaited return to capital markets and on FMS Wertmanagement's five year dollar benchmark.

Public sector issuers are taking advantage of strong summer conditions in the dollar market to bring green and arbitrage-style deals, with more issuance expected next week.

The dollar market is grinding on throughout the summer, with public sector borrowers pushing out deals at the short end, although none have been in benchmark size this week. Two issuers launched transactions on Tuesday with a third slated to follow on Wednesday.