The EU recorded € 107 billion in demand for the first bond

The European Union recorded a demand of 107 billion on Tuesday for the first bond to finance the new recovery fund. This was stated by the main sales manager. The 10-year bond is the first in a planned EU issue of up to € 800 billion to fund a fund that will provide grants and loans to Member States by 2026 to help their economies recover from the COVID-19 pandemic. The EU has sold € 90 billion in bonds since last October to fund its SURE program to support employment in emergency situations. Given the size of the new recovery fund, the European bloc has the potential to become the largest multinational debt issuer in the world. Tuesday's demand shows the continuing interest of investors in buying debt with a rating of AAA. While demand was less than the record € 145 billion the EU saw for the first 10-year SURE bonds, it was higher than in the recent SURE stock offer. Following Tuesday's syndicated agreement, under which the EU has hired banks to sell debt directly to end investors, the bloc plans to sell two more syndicated bonds by the end of July. From September, it will start adding short-term bonds to its financing program to be sold through auctions, which is a more common way. While all SURE bonds were issued as "social bonds", the aim of which is to bring certain "social" benefits, in the case of Tuesday's issue it was a traditional bond. However, approximately 30 percent of the recovery fund will be financed by so-called green bonds, which will go to environmentally friendly expenditures. The bloc is expected to publish its green bond framework by September.