Tricky timing for Greece’s first 2024 foray

The sooner Greece goes to the markets in 2024, the better, say analysts, stressing that demand for Greek bonds during next year’s issues will be particularly strong.

Regarding Greece’s first market foray next year, the Public Debt Management Agency has two scenarios in mind, as the change of track that Greek bonds have marked with their upcoming inclusion in international indices creates new conditions.

Therefore, the PDMA will either issue the first bond of the year, which will probably be a new 10-year bond, within the second or third week of January – when the first wave of issuers is expected in the market since investment interest is high, or will wait until the bonds are included in the indices in February. The last week of January is blocked, as the European Central Bank meets, so the PDMA will not want to make a move.

Seventeen Greek government bonds will be included in the Bloomberg indexes and their yields will start contributing to the index measurements from February 1 – that is, in practice, they will be available for purchase by the “powerful” investors. S&P Dow Jones evaluates additions to its iBoxx indices on an annual basis, with decisions taking effect in late January.

Sources say the PDMA has not yet decided the timing of the first foray in the new year, pending the meetings with primary dealers.

Analysts who spoke to Kathimerini, however, believe that Greece should not delay its first exit. “Having the PDMA wait until Greek bonds start trading on the indexes risks being seen as an opportunistic move,” notes Jan von Gehrich, chief analyst at Nordea Research. The absence of Greece from the market in January, when all countries will have tapped it, will not make for a good picture. “The predictable issuance strategy is much more suitable for maintaining confidence with investors,” he emphasizes.

For his part, Jens Peter Sorensen, chief analyst of Danske Bank, believes that Greece should not wait, because the foray may be more expensive. “In my opinion, PDMA should proceed as early as possible. Investors know that Greek bonds will be included in international indices and will want to buy before the index restructurings which are usually only done when the bonds have been issued,” he tells Kathimerini.