France keeps 2022 bond issuance plans steady, eyes green linker – Reuters

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PARIS, Dec 8 (Reuters) – France is keeping its 2022 borrowing plans steady next year despite a larger than planned deficit and will look into pioneering the inflation-linked green bond market, the public debt management agency said Wednesday in a year-end update.

The Agence France Tresor said it expected to issue 260 billion euros ($293 billion) in medium and long-term bonds net of buybacks for the third year running, unchanged from plans announced in September.

It said it would tap cash available in the Treasury’s account to cover a larger deficit than expected in September when the budget bill now going through parliament was first released.

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The deficit now stands at 155.1 billion euros, up from 143.4 billion, due to measures announced since September to soften the blow of higher energy costs and a new long-term investment plan.

Among new bonds in the pipeline, AFT said it planned to issue medium-term benchmarks with 3 and 5-6 year maturities. For longer-term bonds, it aims to issue two 10-year and one 15-year benchmarks as well as possibly a 20-30 year bond by syndication if market conditions are right.

As for inflation-linked bonds, AFT said it could issue a new 30-year indexed to euro zone inflation by syndication and would carry out “exploratory work” on adding a green bond with a 10-15 year maturity to its line-up of inflation-linked bonds.

France pioneered the now fast growing green bond market for government debt and creating one linked to inflation would make it the first major issuer in the segment.

($1 = 0.8864 euros)

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Reporting by Leigh Thomas; editing by Philippa Fletcher

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