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(Bloomberg) -- Germany will reduce federal debt sales by 13% next year as the government scales back despite a sputtering economy and pressure to support Ukraine’s defense against Russia.

With a change of power pending, the administration intends to sell about €380 billion ($400 billion) in securities, according to a statement published Tuesday by the federal finance agency. That compares with €438.5 billion this year and a record volume of around €500 billion in 2023.

The agency plans to raise a total of €240 billion on the capital market and €126 billion on the money market, the statement said. The debt-issuance plan includes Green Federal securities of between €13 billion and €15 billion.

German bonds extended gains after the announcement, with the yield on 10-year debt falling three basis points to 2.22%.

With early elections taking place in February after the collapse of Chancellor Olaf Scholz’s three-way coalition, the issuance plan is subject to change after a new administration takes charge and adopts its 2025 budget. In the interim, government spending will be limited to legally necessary expenditures and already agreed projects.

Jörg Kukies took over as finance minster after Christian Lindner was fired by Scholz in November, when the ruling alliance failed to agree on a budget for 2025. Finance ministry officials don’t expect a regular budget until the second half of 2025 as talks to form a new governing coalition could take months.

After struggling to grow for years, the German economy is now 5% smaller than it would have been if the pre-pandemic growth trend had continued, and much of the shortfall is related to structural issues and will be tough to recover, according to an analysis by Bloomberg Economics.

Anxieties over declining living standards has contributed to an increasingly fragmented political landscape in Germany. More than a quarter of voters support fringe parties, and the far-right Alternative for Germany is second in the polls ahead of Scholz’s Social Democrats.

--With assistance from Laura Malsch and Greg Ritchie.

(Updates with market reaction in fourth paragraph)