This much is certain: the bond market has become more interesting.

But is that also positive?

It's probably a question of point of view.

Are you just curious, or do you want to invest?

In the latter case, “more interesting” is at least ambivalent.

Yes, yields have increased.

While the current yield for federal securities was still minus 0.46 percent in December, it is currently showing the same value with a positive sign.

Martin Hock

Editor in Business.

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But then there is the question of real interest rates.

With 2 percent inflation and a return of minus 0.46 percent, the annual depreciation is 2.46 percent.

With 5 percent inflation and a return of plus 0.46 percent, the annual loss in value is 4.54 percent.

On the other hand, thanks to falling prices, the price risk with regard to final maturity has of course decreased.

Does that make bonds more attractive now?

In any case, things are lively on the emissions market at least.

Last week, new paper from issuers with good credit ratings (investment grade) worth 5.6 billion euros came onto the market, as well as high-yield bonds with a volume of 1.7 billion euros.

In the first quarter, the volume of investment-grade bonds was almost at the level of the previous year, and demand is healthy, according to Unicredit.

However, this is less true for high-yield bonds.

Here, the issue volume lags behind that of the previous year by almost 60 percent.

The uncertainty of the economic outlook is clearly reflected more in high-yield bonds than in bonds with good credit ratings.

On the other hand, the risk premiums for high-yield bonds are currently well above the lows of the previous year, but have fallen back very significantly from their high at the beginning of March.

However, it is not certain that this so-called “narrowing of the spreads” will continue.

The economic prospects are too uncertain for that.

And the more restrictive the central banks are, the greater this uncertainty will be.

On Tuesday, the apparent move by the US central banker Lael Brainard, who had previously supported a more relaxed monetary policy, to the restrictive camp drew a lot of attention from market observers and caused prices to fall in bond trading.

Not all good news has recently come from the area of ​​so-called SME bonds.

In January, Green City AG had to file for insolvency with three bonds issued.

In March, auto parts maker Paragon negotiated with creditors to extend the term of its July bond, and now Ekosem-Agrar is trying to do the same.

The German company, a holding company for the Russian milk producer Ekoniva, is naturally massively affected by the sanctions against Russia.

The effects of the sanctions, the increase in key interest rates and the currency risks on business development are currently not foreseeable and the originally planned refinancing of the bonds due this year and in 2024 via the capital market will not be possible in the foreseeable future.

However, while Paragon granted creditors a surcharge, Ekosem wants an interest rate reduction from 8.5 and 7.5 percent to just 2.5 percent in addition to an extension by five years.

A repayment option in the event of a change of control is also to be deleted – because expropriation or a ban on financing could threaten in Russia.