Germany May Sell More Russian Debt Bonds

International bond markets are expecting another placement of Russian debt-secured Eurobonds by the German government, according to a report in the Financial Times. In late June, the German Finance Ministry successfully converted $2.4 billion ($1.9 billion) in Russian debt into bonds and sold them. Market experts say a similar placement deal could happen soon, if interest rates remain stable and Russia provides its backing for the issue. "If they still need the cash flow, there is every reason to think they could start thinking about another similar issue towards the end of the fourth quarter (of 2004)," Harvinder Sian, an analyst at ABN Amro told the Financial Times. Germany's decision to sell bonds secured by Russian debt came out of pressure on the country to reduce its state budget deficit, which has exceeded the 3 percent limit set for EU states for the past three years.