Sovereign borrowers are slimming. (European governments may borrow less in 1987)

SOVEREIGN BORROWERS ARE SLIMMING

Even the most opportunistic European sovereign borrowers will have smaller funding requirements in 1987. There will always be wild cards: the United Kingdom’s two huge FRN issues took $6.5 billion from the capital markets in 1986 as the British government sought to shore up reserves for playing in the forex markets. The Republic of France occasionally is rumoured to be considering a return to the Euromarket. But the regular sovereign borrowers agree that they’ll be giving less business to bankers.