Recent data on the slowdown in the European economy should remind investors about buying “secure” state bonds. They are not as popular as in previous years. Too low interest rate has not recently encouraged investors to purchase Treasury debt securities.
At the beginning it is worth recalling that from July there will be new regulations regarding corporate bonds that may hit the entire debt market. The main changes are the dematerialisation of debt securities and the creation of a new institution – bond issue agent. Experts warn that the changes introduced may discourage investors from entering the entire bond market, not just corporate ones.
Ministries of Finance said that in March Treasury bonds were purchased for the amount of over PLN 1 billion. The most popular are 3-month, 2-year and 4-year papers. The May bond offer sustains interest rates at the same level as in April.
In the state bonds offer, as usual, we have 3-month securities with an interest rate of 1.5%. Instruments with a longer investment period are provided for 2 (interest rate at the level of 2.1%), 3, 4 and 10 years.
– For 3-year securities, the interest rate is calculated every six months based on the value of a 6-month interest rate, after which the banks borrow money. In the case of 4-year bonds, the interest rate changes every year and is calculated on the basis of the sum of the inflation rate from the last 12 months and the margin maintained at 1.25%. The same mechanism as for four years is valid for 10-year bonds. For securities with the longest time horizon, however, the margin is higher, amounting to 1.50% – we read on the website of the Ministry of Finance.
For those who receive the “Family 500 plus” benefit, two options for investing in bonds were created. They can buy “family papers” for 6 and 12 years. Their interest rate is variable, calculated as the sum of inflation and the interest margin of 2%. In the first year (interest period) the interest rate is calculated on the amount of PLN 100, and in the following years this value is increased by interest accrued for the previous year. Thanks to this, the profitability of family bonds is increased.
In June 2018, the State Treasury proposed bonus bonds. The investment in 10-month securities was associated with additional earnings. The purchased bonds took part in the lottery, thanks to which you could win up to 10,000. bonus bonus. A month ago, investors who managed to obtain additional prizes were drawn randomly (of course, they had to pay 19% of the tax). The Ministry does not rule out reintroducing bonus bonds this year.
According to CSO data, inflation is currently at the level of 1.7%. Next year is expected to increase, which will result in the most favorable bonds for 4 and 10 years. At the moment, bonds with a fixed interest rate of 1.5% do not protect against inflation.