Market Summary

Yield Movements

Between 3 March and 30 May, local currency (LCY) government bond yields in Singapore fell for all maturities. Bond yields fell an average of 45 basis points across the curve, largely driven by the Monetary Authority of Singapore's (MAS) monetary policy easing and weakening economic growth outlook. On 14 April, MAS eased its monetary policy stance for a second time this year due to slowing economic growth and moderating inflation expectations. In the first quarter (Q1) of 2025, Singapore's economy expanded 3.9% year-on-year (y-o-y), slower than the previous quarter's growth of 5.0% y-o-y amid cooling manufacturing and trade-related services sectors. In April, consumer price inflation remained at 0.9% y-o-y, the same as in February and March, and lower than 1.2% y-o-y in January.

Local Currency Bond Market Size and Issuance

At the end of March, Singapore's LCY bond stock rose 2.0% quarter-on-quarter (q-o-q) to SGD866.9 billion, faster than the previous quarter's 1.6% q-o-q expansion. Outstanding Treasuries and MAS bills exhibited growths of 3.5% q-o-q and 1.5% q-o-q respectively. Outstanding corporate bonds inched up 0.7% q-o-q in Q1 2025, slower than the previous quarter's 2.5% q-o-q growth. Meanwhile, total LCY bond issuance grew 0.7%, lagging behind the previous quarter's pace of 3.0% q-o-q, as growth moderated across all bond segments.

Sustainable Bond Market

In Q1 2025, outstanding sustainable bonds grew 2.3% q-o-q to reach USD26.6 billion, predominantly composed of green bond instruments. Total outstanding sustainable bonds were mostly denominated in local currency (82.4%). Bonds carrying tenors of over 5 years comprised 59.7% of total outstanding sustainable bonds at the end of March, resulting in a size-weighted average tenor of 16.2 years.