German Bundesbank reports EUR 75.2 billion rise in bond market outstanding, domestic investment funds draw EUR 11.2 billion in May

The German Bundesbank published May market statistics showing that the amount of bonds outstanding in Germany increased by EUR 75.2 billion. Domestic bond issuance remained broadly stable in gross terms at EUR 134.4 billion, and after redemptions and changes in issuers’ own holdings, outstanding domestic debt securities rose by EUR 49.2 billion. Foreign debt securities placed on the German market added a further EUR 25.9 billion. The data also showed stronger demand for investment funds, with domestic funds recording net inflows of EUR 11.2 billion, while new domestic equity issuance was limited at EUR 0.7 billion. On the bond market, the main driver was the public sector, which increased its net bond market liabilities by EUR 37.7 billion after net redemptions of EUR 21.9 billion in April. Banks issued EUR 6.3 billion net and domestic companies EUR 5.2 billion net, including EUR 3.3 billion from nonfinancial corporations. Foreign investors were the largest net buyers of domestic debt securities at EUR 37.4 billion, while domestic banks bought EUR 25.3 billion and domestic nonbanks EUR 16.6 billion, with both domestic groups focusing mainly on foreign paper. Bundesbank bond holdings fell by EUR 4.1 billion, mainly because of maturing assets from Eurosystem purchase programmes. In equities, domestic banks were the main buyers at EUR 4.0 billion, while foreign investors sold German shares on a net basis for EUR 1.8 billion. In funds, inflows went mainly to Spezialfonds at EUR 7.6 billion and to mixed securities funds at EUR 6.5 billion, while foreign fund companies active in Germany recorded EUR 11.3 billion in inflows.