EM faces tough future as bond sales slump

jueves 2 de abril de 2015 11:06 GYT
 

* Global EM bond volumes lowest since 2011

* Euro first quarter issuance highest ever

* US rate rises spark warnings about EM debt

By Michael Turner

LONDON, April 2 (IFR) - Emerging market first quarter bond issuance volumes have slumped to their lowest levels in four years, and the prospects for the asset class remains bleak after an industry lobby group gave a stark warning of the risks that rising US treasury rates pose to issuers.

Asian emerging market issuers propped up the muted volumes in the first three months of 2015 to print US$52.3bn-equivalent of hard currency bonds, compared with US$31.8bn in Latin America and US$35.4bn in Central and Eastern Europe, Middle East and Africa, according to Thomson Reuters.

This US$119.5bn total is the lowest amount of hard currency bonds sold in the first quarter in global emerging markets since 2011, when US$70bn was issued. In the first quarter of 2014, emerging markets bond sales totalled US$145.3bn.

In Asia at least, volumes have stood firm with overall issuance of G3 and offshore renminbi bonds slightly up over the same period last year.

"While most of the market felt Q1 was quieter than past years, perhaps due to reduced volumes in China high yield, total issuance volumes were actually higher," said Duncan Phillips, managing director and head of Asia-Pacific debt syndicate at Citigroup.   Continuación...