Reopening of 6-Year Government Bonds
The Ministry of Finance has reopened the issuance of 6-year government bonds, which were originally auctioned on May 13, 2024. This issuance is denominated in the local currency, with a maturity date of May 15, 2030, and an annual coupon rate of 3.25%.
The volume of the issuance was increased by 200 million units at the auction held on July 8, 2024, bringing the total nominal value to 600 million units. The weighted average annual yield at the reopening auction was 3.82%.
Total bids received amounted to 259.4 million units, showing strong interest from investors in the reopened government bonds.
Investing in Federal Bonds
When it comes to investing in federal bonds, it is important to consider the coverage coefficient and the spread compared to similar German federal bonds. The coverage coefficient of 1.3 is a good indicator of the security of the investment, providing a sense of stability and reliability for investors.
The spread, which measures the difference in yield between the two types of bonds, is currently at 132 basis points. This gap can provide opportunities for savvy investors to capitalize on potential returns and diversify their portfolio.
Participant Distribution at Auction
At recent auctions, banks emerged as the largest participants, acquiring 79.9% of the total bonds. They were followed by insurance companies at 10.2%, pension funds at 9.5%, investment intermediaries at 0.3%, and other investors at 0.1%. This distribution highlights the confidence that financial institutions have in federal bonds as a secure investment option.
