AFT plans launch of new Eurozone inflation bonds

French debt agency, Agency France Trésor (AFT), plans to issue new inflation-linked bonds known as OATEURi that can be used for inflation hedging and portfolio diversification, according to AFT chief executive Sylvain de Forges, speaking at a conference held at London’s Savoy Hotel yesterday.

Along with investors such as pension funds and insurance companies that will use the bonds as a hedge against inflation and for portfolio diversification, swaps desks and hedge funds will also use the product for hedging their books and arbitraging similar structures in the US, respectively. Swaps desks are already large users of OATi – the bonds that were launched back in 1998 and are indexed on the French index of prices excluding tobacco, according to the AFT.

“These bonds are a new asset

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