December 1, 2023

Taylor Daily Press

Complete News World

Peak government bonds

Peak government bonds

The Belgian state issues five- and eight-year government bonds only in December. The press release was issued by the Federal Debt Agency, but the decision was at least partly settled through political games.

A Belgian saver who was hoping for a second chance with a one-year government bond will be disappointed. With the possible exception of the CD&V, no political party has given Finance Minister Vincent van Petegem an extra round as the patron saint of Belgian savers, with elections looming.

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1. Are five- or eight-year government bonds interesting?

no. When it comes to bonds, the world has turned upside down. Six-month or one-year bonds yield more than longer maturities. Moreover, a reduction in the withholding tax rate was only promised on one-year government bonds. If the government bond coupon were held constant today, government bonds would likely yield approximately 2 percent net over five and eight years. There are even savings accounts that work better: