The PRC reported several economic indicators last week, including a 16.1% y-o-y expansion in industrial production, a larger trade surplus of USD24 billion, 29.4% y-o-y M2 money supply growth, and consumer price inflation of -0.5% y-o-y in October. Japan's seasonally-adjusted real GDP expanded by an annual rate of 4.8% and Indonesia's GDP grew by 4.2% y-o-y in October. Government bond yields generally fell in most emerging East Asian markets.
Policy interest rates were held steady in most emerging East Asian markets last week, with the exception of Australia, which hiked its cash rate to 3.5%. Consumer prices are gradually rising in the region, with consumer price inflation rates for the month of October at 2.0% in Republic of Korea, 2.57% in Indonesia, 0.4% in Thailand, 1.6% in the Philippines, and 2.99% in Viet Nam.
In the third quarter, the People’s Republic of China (PRC) posted its fastest economic growth rate this year, on the back of continued credit expansion and stimulus spending. The country’s third quarter gross domestic product (GDP) increased 8.9% year-on-year (y-o-y)—well above the GDP growth rates of 6.11% and 7.9% registered in the first and second quarters of the year, respectively. Industrial production in September rose 13.9% y-o-y, the most in over a year, while September retail sales increased 15.5% y-o-y. GDP growth in the Republic of Korea (Korea) is also rebounding. Korean GDP in 3Q09 rose 2.9% quarter-on-quarter (0.6% y-o-y), leading to market speculation that the Bank of Korea may be considering an increase in its policy rate.
New loans in the People's Republic of China (PRC) surged in September, reaching CNY516.7 billion, which is significantly higher than the August figure of CNY410 billion. In the same month, broad money, as measured by M2, grew by 29.3% year-on-year (y-o-y). Other significant PRC economic data for September included 15.2% (y-o-y) export growth and an 18.9% (y-o-y) increase in foreign direct investment (FDI) inflows to a level of USD7.9 billion. Foreign-exchange reserves in September climbed to USD2.273 trillion, due to a still substantial monthly trade surplus and inflows of foreign capital.
Last week saw several East Asian markets leaving their benchmark rates unchanged from previous levels. Bank Indonesia has decided to keep its benchmark rate steady at 6.5% for the second consecutive month since August of this year. Bank of Korea has also kept its base rate unchanged at 2.0%. Bangko Sentral ng Pilipinas in its meeting held on 01 October retained its overnight borrowing rate at 4.0% and overnight lending rate at 6.0%. The Reserve Bank of Australia's (RBA) move to raise its cash rate by 25 basis points to 3.25% effective 07 October has raised expectations that Asian central banks may follow suit later this year or in early 2010.
Monthly data for LCY bonds outstanding of Indonesia is now available in the Macroeconomic and Credit Indicators table.
Monthly data for LCY bonds outstanding of the Philippines is now available in the Macroeconomic and Credit Indicators table.
Monthly data for LCY bonds outstanding of Thailand is now available in the Macroeconomic and Credit Indicators table.
Monthly data for LCY bonds outstanding of the People's Republic of China is now available in the Macroeconomic and Credit Indicators table.
Monthly data for LCY bonds outstanding of Malaysia is now available in the Macroeconomic and Credit Indicators table.
Signs of economic and industrial recovery were seen in several Asian markets last week, with Viet Nam's 3Q09 GDP expanding by 5.8% y-o-y, PRC's purchasing manager index rising to 54.3 in September, and Japan's industrial output improving by 1.8% m-o-m in August. Consumer prices slightly rose in Indonesia and Republic of Korea while they fell in Japan and Thailand. The PRC initiated the sale of CNY6 billion of Treasury bonds in Hong Kong, China last week.
Issuance activity in the PRC remained strong last week, with large bond sales from the Ministry of Railway, China Development Bank (CDB), and the Agricultural Development Bank of China (ADBC). At the same time, investor demand for cash increased as the deadline approached for subscribing to IPO's that will be listed on the PRC's newly established "start-up" board for IPO's at the Shenzhen Stock Exchange. This heightened demand for cash pushed the 7-day repurchase rate to a high of 1.85% on Friday, before easing after the subscription deadline had passed. Government bond yield curves in the region remain largely unchanged last week.
A number of positive news items came out of Indonesia last week. The government announced that spending for its economic stimulus program would be reduced in 2010 to less than 1.0% of GDP. The total amount of programmed spending for the stimulus program this year is IDR73.3 trillion, which is equivalent to 1.4% of GDP. The World Bank has revised Indonesia's economic growth outlook upward to 4.3% and 5.6% for 2009 and 2010, respectively, due to strong domestic consumption and improved trade performance. Finally, Moody's Investors Service has upgraded the country's FCY and LCY debt ratings to Ba2 from Ba3, with a stable outlook.
Growing corporate issuance along with government funding for economic stimulus packages drove growth in emerging East Asia's local currency bond markets in the first half of 2009, says the latest edition of the Asia Bond Monitor. Local bond markets have emerged as a key source of finance for companies in these volatile times, but they remain dominated by state-owned entities, infrastructure companies and banks.
Economic data released last week by the People’s Republic of China (PRC) points toward a strengthening recovery. Most importantly, cumulative urban fixed-asset investment in the first 8 months of the year increased 33% compared to the same period last year, while August industrial output rose by 12.3% year-on-year (YOY). The most significant new bond issue last week was the USD3 billion of 6 and 10-year maturities – with coupons of 4.625% and 5.75%, respectively - issued by Hutchison Whampoa of Hong Kong. Bonds issued by Hutchison Whampoa are generally considered to be the effective benchmark for most of the Asian G-3 currency bond market.
The latest Weekly Debt Market Highlights reports that the PRC government agreed to purchase SDR32 billion of IMF notes last week, while important new bond issues included a USD300 million high-yield issue by PRC-based Country Garden, HKD3.5 billion of 2-year government bonds from Hong Kong, China; and JPY30 billion of samurai bonds issued by Korean Development Bank. Korea reported that 2Q09 GDP grew by 2.6% q-o-q, while manufacturing activity improved in the PRC and Singapore. August consumer price inflation accelerated in Indonesia, Korea, and Thailand, but slowed in the Philippines. Government bond yields generally fell in most Asian markets.
Archived issues of the Weekly Debt Highlights are now available via the Weekly Debt Highlights-Past Issues. The archive dates back from the Weekly Debt Highlight's inception in 2 March 2009.
The latest Weekly Debt Highlights reports that gross domestic product (GDP) growth results in the region remain mixed. The Philippines reported GDP growth of 1.5% y-o-y for 2Q09, while Malaysia and Thailand reported a slower rate of decline for their respective GDP growth rates—compared to 1Q09. Malaysia's GDP growth rate for 2Q09 contracted at a y-o-y rate of 3.9%, compared to a 6.2% decline in 1Q09. Thailand’s 2Q09 GDP fell by 4.9% y-o-y, after declining by 7.1% in 1Q09.
An update on bond market development for China, People's Republic of, as of 1H2009 is now available.
An update on bond market development for Hong Kong, China as of 1H2009 is now available.
An update on bond market development for Indonesia as of 1H2009 is now available.
An update on bond market development for the Republic of Korea as of 1H2009 is now available.
An update on bond market development for Malaysia as of 1H2009 is now available.
An update on bond market development for the Philippines as of 1H2009 is now available.
An update on bond market development for Thailand as of 1H2009 is now available.
An update on bond market development for Viet Nam as of 1H2009 is now available.
Economic data releases last week reaffirmed the progress of the economic recovery in the People’s Republic of China (PRC). Industrial output in July rose 10.8% year on-year (y-o-y), compared to the 10.7% and 8.9% growth registered in June and May, respectively. July’s increase, however, was below expectations of an 11.5% rise. Total urban fixed-asset investment in the first 7 months of the year increased 32.9% y-o-y and July retail sales increased 15.2% y-o-y. New loans in July fell to CNY355.9 billion—less than one quarter of the more than CNY1.5 trillion in new loans extended in June—as banks moved to limit their exposure to bad loans.
Yet another week of active FCY and LCY bond issuance in Asia was highlighted by huge issuances from Malaysian oil company Petroliam Nasional Berhad (Petronas) and Indonesia's state utility firm PT PLN. Petronas issued bonds amounting to USD4.5 billion, the largest corporate bond offering in Asia in the last 5 years: USD3 billion 10-year conventional notes with a coupon of 5.25% and USD1.5 billion 5-year sukuk (Islamic bonds) at 4.25%. Both were priced to yield 162.5 basis points over comparable US Treasuries. PT PLN issued USD750 million in bonds with a 10-year maturity and priced to yield 8.125%. Japan issued JPY600 million of 30-year government bonds with a coupon of 2.3%. In Singapore, property developer CapitaLand issued SGD1.1 billion of 7-year convertible bonds to fund new investments and working capital.
The latest edition of the Weekly Debt hightlights reports taht demand for new bond issues remained robust with a wide variety of new offerings in both USD and LCY coming to market. In the USD market, the Korea National Oil company (KNOC) launched its first ever USD bond issue of USD1 billion with a coupon of 5.375% while Woori Bank issued USD800 million of senior bonds maturing in February 2015. The Hong Kong Mortgage Corporation (HKMC), a quasi-government entity, priced USD500 million in 5-year bonds paying a coupon of just 3.5%. Malaysia's state oil company, Petronas, is planning to issue USD-denominated 5-year sukuk (Islamic bonds) and 10-year conventional notes. This will be Petronas’ first US Dollar issue since 2002. Thailand's largest oil conglomerate, PTT, is raising the size of its bond issue to THB35 billion from THB30 billion through a “green shoe” option worth THB5 billion.
The latest edition of the Weekly Debt hightlights reports taht demand for new bond issues remained robust with a wide variety of new offerings in both USD and LCY coming to market. In the USD market, the Korea National Oil company (KNOC) launched its first ever USD bond issue of USD1 billion with a coupon of 5.375% while Woori Bank issued USD800 million of senior bonds maturing in February 2015. The Hong Kong Mortgage Corporation (HKMC), a quasi-government entity, priced USD500 million in 5-year bonds paying a coupon of just 3.5%. Malaysia's state oil company, Petronas, is planning to issue USD-denominated 5-year sukuk (Islamic bonds) and 10-year conventional notes. This will be Petronas’ first US Dollar issue since 2002. Thailand's largest oil conglomerate, PTT, is raising the size of its bond issue to THB35 billion from THB30 billion through a “green shoe” option worth THB5 billion.
The latest edition of the Weekly Debt hightlights reports that economic recovery is underway in several Asian economies. The Republic of Korea posted second quarter GDP growth of 2.3% q-o-q, which was the fastest pace in more than 5 years, due to a strong demand from the People's Republic of China (PRC). Thailand's merchandise exports also showed improvement in June with growth of 5.8% m-o-m. On an annual basis, both Japanese and Thai exports fell in June, but at a slower pace of decline compared to the previous month.
Emerging East Asia has entered the transition from recession to a possible V-shaped recovery, with growth dropping sharply this year before returning to 2008 levels in 2010, says ADB's July issue of the Asia Economic Monitor (AEM), launched 23 July in Bangkok.
"Emerging East Asia has entered the transition from recession to a possible V-shaped recovery, with growth dropping sharply this year before returning to 2008 levels in 2010," says ADB's July issue of the Asia Economic Monitor (AEM), launched 23 July in Bangkok.
"Emerging East Asia has entered the transition from recession to a possible V-shaped recovery, with growth dropping sharply this year before returning to 2008 levels in 2010, says ADB's July issue of the Asia Economic Monitor (AEM), launched 23 July in Bangkok.
To further boost corporate bond issuances the Malaysian government established the national financial guarantee institution, Danajamin Berhad which will provide financial guarantee insurance for issues of private debt and Islamic securities.
The latest edition of the Weekly Debt Highlights reports that a number of important FCY bonds sales from the Philippines, Indonesia and the Republic of Korea as well as several LCY bond issues from the People's Republic of China, Malaysia and Thailand.
The latest edition of the Weekly Debt Highlights reports that there were several large bond issues as well as bond auctions falling short of target. In the People's Republic of China, the Bank of China sold a total of CNY40 billion in floating-rate and step-up notes, and energy conglomerate Shenhua Group issued CNY20 billion in 5-year bonds. Additionally, five local governments, including those of the Xinjiang region and the city of Shenzhen, sold a combined CNY11.9 billion in 3-year bonds. In the Republic of Korea, the Export-Import Bank of Korea issued USD1.5 billion in 5.5-year bonds. Of particular note were the Treasury auctions of the PRC and Viet Nam. For the fifth consecutive time since March, Viet Nam's State Treasury failed to sell VND1.5 trillion (USD84.3 million) of bonds as investors required higher yields.
The latest edition of the Weekly Debt Highlights reports that the People's Bank of China will on a pilot basis, permit firms to use the yuan for the settlement of international trade transactions. Malaysia's Prime Minister announced measures that end restriction on foreign investment in most sectors of the economy and open up the investment management and brokerage industries, as well as property, ending requirements for 30% ownership by ethnic Malays.
Singapore's CPI inflation, foreign exchange rate, external reserves and 10 yr. gov't bond rate for May are now available via the Macreconomic and Credit Indicators
The latest edition of the Weekly Debt Highlights reports that the Indonesian Bond Pricing Agency (IBPA) announced last week that it will soon begin to provide daily reference prices for corporate bonds and ijarah type of sukuks. This move is expected to help improve transparency and make Indonesia's debt market more attractive to investors. Indonesia's corporate bond market is generally illiquid. IBPA noted that on any given day less than 5% of issues are traded, which deters investors from entering the market and makes it harder for companies to raise funds. The availability of a reference price should help firms planning to issue bonds more accurately estimate their cost of borrowing and provide a benchmark for those seeking to trade bonds. Plans to provide reference prices for other types of sukuks and other assets - such USD-denominated bonds, bond futures, and interest rate futures- are also being considered by IBPA.
AsianBondsOnline now tracks previous day changes, previous week changes and year-to-date changes for selected government bond yields, major currencies, local interest rates and policy rates.
The Market Watch section on AsianBondsOnline's regional and individual market pages provides latest closing rates as well as the changes from previous day, week, month-to-date (MTD) and year-to-date (YTD).
The latest edition of the Weekly Debt Highlights reports that upcoming issues were anounced in the Philippines, Viet Nam, Indonesia and the Republic of Korea. The Government of the Philippines is considering a Samura bond issue worth up to USD1.5 billion given the rise of its budget deficit target to PHP250 billion, or 3.2% of GDP, while Robinson's Land Corporation plans to issue PHP5 billion worht of 5- and 7-year bonds. Additionally, the government of Viet Nam is planning to issue around USD1 billion in the domestic market to finance its budget deficit and large stat projects. In Indonesia, PT Telekomunikasi Indonesia Tbk is planning to issue between IDR1 trillion worth of bonds in 2010 to funds its capital expenditure requirements while the firms' cellular unit is also planning to issue LCY and FCY bonds next year. Meanwhile, Indonesia's Permata Bank sold USD100 millio of 12-year subordinated medium-term notes to finances its debt for business expansion and to strengthen its capital structure.
The latest edition of the Weekly Debt Highlights says that data released provided further indications that an economic rebound is underway in the People's Republic of China. For the first five months of the year, urban fixed-asset investment surged 32.9% y-o-y to CNY5.352 trillion. Property sales also posted strong gains. In the first five months of the year, the value of property sales climbed by 45.3%, y-o-y, which was the largest increase since February 2006.
AsianBondsOnline povides the Feedback section for visitors who might have questions about the Asian bond markets as well suggestions on how to improve the website.
The latest edition of the Weekly Debt Highlights reports that a number of important new issues came from Japan, Republic of Kroea and the Philippines. Japan's Nippont Telegraph and Telephone Corporation sold a total of JPY170 billion worth of 5- and 10-year bonds. Korea's Kookmin Bank tapped the international bond market and sold USD300 million worth of 3-year Reg-S bonds due in June 2012. In the Philippines, Land Bank of the Philippines raised PHP6.9 billion of subordinated notes, while SM Investments Corporation's PHP5 billion bond issue was oversubscribed. Furthermore, Thailand's Fiannce Ministry announced that it will issue savings bonds initially worth THB30 billion, which is part of the THB400 billion the government intends to borrow domestically.
China's 1Q GDP is now available via the Macreconomic and Credit Indicators
Bank Indonesia's reference rate is now available via the Macreconomic and Credit Indicators
Japan's vehicle sales, end of period exchange rates, M1 and M2 growth, international reserves overnight borrowing rate and 10-year gov't rate as of June are now available via the Macreconomic and Credit Indicators
The Bank of Korea's policy rate as of June is now available via the Macreconomic and Credit Indicators
The Philippines' CP inflation, end of period exchange rates, international reserves, overnight borrowing rate and 10-year gov't bond rate are now available via the Macreconomic and Credit Indicators.
Singapore's CPI inflation, foreign exchange rate, external reserves and 10 yr. gov't bond rate for May are now available via the Macreconomic and Credit Indicators
Thailand's consumer price index for May is now available via the Macreconomic and Credit Indicators
Vietnam's consumer price index and industrial production for June is now available via the Macreconomic and Credit Indicators
Macroeconomic, balance of payments and government credit indicators are updated on a monthly and quarterly basis.
The latest edition of the Weekly Debt Highlights features the Asian Bond Monitor - Summer Edition's major theme. Growth rates in Asia's LCY bond markets stabilized in 1Q2009, as governments implemented fiscal stimulus packages to offset economic slowdowns, central banks begal to issue for broader monetary management purposes, and corporate issuance recovered. The emerging East Asian bond market grew by 1.1% in 1Q2009 compared with the last quarter of 2008.
The Summer Edition of the Asian Bond Monitor reflects that Emerging East Asia's local currency bond markets showed signs of stabilization in the first quarter of 2009 as governments implemented fiscal stimulus packages, corporates raised funds and banks issued more subordinated debt.
The latest edition of the Weekly Debt Highlights says that several Asian countries reported significant declines in their GDP growth rates in the first quarter of 2009. On a year-on-year basis, real GDP growth rates for Japan, Singapore, and Thailand, were -9.7%, -10.1% and -7.1%, respectively. Japan's first quarter contraction was brought about by a sharp fall in exports and weaker domestic demand. In Singapore, the negative growth is attributed to a plunge in expenditure, especially domestic investments and net exports. In Thailand, the slump in exports and manufacturing activity contributed to the fall in the country's first-quarter GDP.
ADB's Handbook on International Best Practices in Credit Ratings is now published in AsianBondsOnline. Credit Ratings. ADB believes it is essential for Asian Domestic Credit Ratings Agencies (DCRAs) to adopt international best practices, which will enhance the comparability of ratings among credit agencies - domestic and global - and give investors greater confidence in DCRA's ratings. The handbook should serve as a reference for regulators with oversight responsibilities for the regions DCRA's.
The latest edition of the Weekly Debt Highlights says that corporate bond issuance remains a dynamic story in the region. Two examples occurred in the People's Republic of China and the Philippines, while progess continued on planned issues in Indonesia, Republic of Korea, and Thailand. China National Petroleum Corporation sold USD1 billion of 3-uear floating notes, while in the Philippines, Rizal Commercial Banking Corporation's PHP4 billion lower Tier 2 subordinated notes were oversubscribed. Finally, the Malaysian government announced the creation of Danajamin Nasional Berhad late last week, a national financial guarantee institution that will provide credit enhancement for corporate bond issues.
The latest edition of the Weekly Debt Highlights reports the IMF said that Asia's economies may face the prospect of a slower than expected recovery of their export sectors, as the US and other advanced economies may not immediately respond to pump-priming initiatives of their respective governments. Thus, the efforts of Asian governments to promote domestic consumption will become increasingly important.
The latest edition of the Weekly Debt Highlights reports that the annual meeting of the Asian Development Bank (ADB) in Bali yielded a number of important developments: First, ADB announced that its Board of Governors approved a 200% increase in ADB's capital to USD165 billion, which the Board expects will permit ADB to extend about USD32 billion in loans in 2009-2010, compared with initial plans to disburse USD22 billion over the same period.
The latest edition of the Weekly Debt Highlights reports the Group of Seven (G7) countries announced that they are expecting economic activity to recover later this year, although it will be a weak recovery in the coming months.
The first edition of ADB's Asia Capital Markets Monitor (ACMM) shows that Asia's capital markets are starting to stabilize and the region's relatively resilient economies should help them recover as the global crisis ebbs and investor appetite returns.
"The new AsianBondsOnline was launched on 21 April 2009 in Tokyo, Japan during the Asian Capital Markets Conference. AsianBondsOnline is part of the ABMI. It is a one-stop clearinghouse of information on sovereign and corporate bonds. It presents both regional and market-specific information in a structured format, giving market participants and potential investors a clear perspective of the current market. Government and private sector initiatives to enhance market depth and liquidity are also detailed. "
