Marcus Ashworth, Columnist

Europe’s Covid Debt Party Just Keeps Raging On

Demand for EU pandemic bonds held strong for a second big bang sale.

June 29, 2021 at 11:50 AM UTC

Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. Previously, he was chief markets strategist for Haitong Securities in London.

Winning.
Photographer: Dean Mouhtaropoulos/Getty Images Europe

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It’s tricky following up a smashing success. But the European Union faced no such problems with its dual-tranche 15 billion-euro ($18 billion) five-year and 30-year bond sale Tuesday.

After a barnstorming opener in mid-June for the NextGenerationEU recovery fund, with a blowout sale of 20 billion euros of 10-year bonds, the scale of demand for the follow-up was just as stratospheric. This time, there was more than 130 billion euros of orders for the capped 15 billion-euro fundraising — a proportionally stronger outcome than the first sale. This is also particularly impressive for a 30-year maturity. The pricing overall was much closer to the existing curve of outstanding EU issues than the generous new issue premium indicated initially for the 10-year.