about interest rates and state spending, and made it harder for Germany - typically a reluctant spender - as it seeks to fund its 200 billion euro scheme to cut domestic energy costs.
The 0.47 bid-to-offer ratio at the sale was the lowest of any 7-year German bond sale and the second lowest of any of its auctions going back to 1999, according to a Reuters analysis of finance agency data. Germany kept 55% of the issuance on its own books, the second-largest amount on record. Hit hard by its over-reliance on Russian energy, Germany intends to borrow particularly large amounts in the coming years, with Parliament last week voting to suspend the constitutional debt brake that limits new borrowing.
Rising issuance comes as the ECB weighs plans to start shrinking its asset holdings via so-called quantitative tightening . “It is really the volatility that makes it difficult...The members of the Bund auction group take risk when they bid in an auction,” Diemer said, referring to Germany’s primary dealers, who participate in auctions and sell the debt on to investors.
“No one wants duration risk here because of the Federal Reserve and the ECB hiking rates,” Leister said, referring to longer-dated debt.
You mean fossil-fuel funded buyers?