Euro: Supported by heavy sovereign issuance – BNY

BNY highlights that European governments have raised a record USD 504 billion via syndicated bonds in 2026, driven by defense, infrastructure and energy-transition spending. Despite higher yields and rate uncertainty, demand remains strong, helping governments manage refinancing needs. Italy leads issuance, while Eurozone risk assets and EUR/USD show modest gains alongside Euro government bond yields.

Record Eurozone supply meets strong demand

"Governments have raised a record USD 504bn through syndicated bond sales so far in 2026, surpassing even the pace seen during the first half of the pandemic."

"Despite rising yields and uncertainty over the interest rate outlook, investor demand for sovereign debt remains strong, enabling governments to lock in funding and manage elevated borrowing needs."

"Market participants expect issuance to remain heavy through the second half of 2026 as refinancing pressures continue."

"BRL, USD and CAD recorded the largest outflows, while broad-based inflows favored the rest of the iFlow universe, led by CHF, SEK and EUR."

"Demand remained strongest for LatAm government bonds, followed by Canada and the Eurozone."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)