Deutsche Telekom is poised this week to launch the largest global bond issue. Strong investor demand may lead it to increase its offering. An $8 billion multi-currency deal announced earlier this month, with tranches in dollars, euros, sterling and yen will be increased to at least $11 billion. The books for the dollar tranches will close today, earlier than expected, due to strong demand. These alone could amount to $10 billion.

Some investors said the deal may reach $15 billion, the maximum amount Deutsche Telekom registered with the US Securities and Exchange Commission, if demand for euro, sterling and yen tranches proves strong enough.

Sentiment in the corporate bond market has improved as investors have become less worried about the prospect for interest rate rises in the US. Deutsche Telekom is also attracting investors by offering generous coupons - the annual rate of interest paid.

The yield that Deutsche Telekom plans to offer is in line with where Vodafone Airtouch's bonds trade, even though Vodafone's credit ratings are lower. Usually, higher-rated companies pay less than lower-rated ones.

Telecoms companies are among the biggest borrowers in the international bond markets, as they seek funds to merge with or acquire rivals and to invest in buying licences in Europe for third-generation mobile phones.

The biggest existing corporate bond is a €9.4 billion ($9 billion) bond issued by Tecnost, the funding vehicle used by Olivetti to acquire Telecom Italia last year. This bond was unusual in that it paid a variable interest rate, compared with the fixed rate of interest paid on most corporate bonds.

The Deutsche Telekom offering also looks set to overshadow the biggest fixed-rate global deal, an $8.6 billion transaction from Ford.