Germany is “closely monitoring” the dollar-denominated bond market for a possible sale, the head of the nation’s debt agency said.
“Dollar bonds are looking more attractive now from the issuer’s perspective than a couple of months ago,” Carl Heinz Daube, head of Germany’s Federal Finance Agency, said today in an interview from Frankfurt. “Nevertheless, there’s still no cost advantage for us at this point. If the price is right, we won’t say no.”
Selling dollar bonds would allow Germany to appeal to a wider range of investors, including money managers in the U.S. who don’t want to take on foreign-exchange risk. The agency issued five-year dollar bonds in 2005, the only time it sold debt denominated in the U.S. currency.
A meeting with U.S. investors suggested there’s “strong” interest in the debt, Daube said.
“I met investors in the U.S. last week and a number of institutional investors seemed to be keen to invest in Germany’s dollar bonds,” he said. “The final decision is with the Ministry of Finance.”
Germany hired banks to sell the five-year securities that come due in 2010 and may do so again should it proceed with a dollar-bond sale, Daube said on June 23.
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