Outlook for the week
New bond issues may begin tapping the SGD market after a lull in June.
Key economic releases for the week
Last Week Summary
Jerome Powell affirms the Federal Reserve will provide stimulus to aid economic recovery
despite the highest inflation rate in a decade. As a result, the 10y US Treasury yields rallied from a mid week high of 1.42% to print below 1.3% on Thursday. In Asia, The People’s Bank of China (PBOC) surprised the market with a reduction in reserve requirement for its banks. Activity in Asia primary market picked up this week with 21 bonds priced over 19 deals. 13 out of the 19 deals are from Chinese issuers, with 7 of them from the Chinese real estate sector. It is a great week for investors in the primary market, with issuers leaving decent new issue premium on the table and strong secondary market performance as a result of the rates rally. US$7.699bn of bonds was issued from 19 deals. Breakdown: Investment Grade: US$5.450bn, High Yield: US$989mn, Non-Rated: US$1.26bn.