AsianBondsOnline Newsletter (27 July 2015)

To read the full report, data and graphs go to http://www.asianbondsonline.adb.org/newsletters/abowdh20150727.pdf?src=newsletter&id=uWidK3KdmgXVUWes9IgIcqKp1miwxx

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News Highlights - Week of 20 - 24 July 2015

The Composite Consumer Price Index (CPI) in Hong Kong, China rose 3.1% year-on-year (y-o-y) in June, following a 3.0% y-o-y hike in May, driven by accelerating price increases in food, housing, and utilities. Singapore’s CPI fell 0.3% y-o-y in June, its eighth consecutive month of y-o-y decline, largely induced by a drop in the price index for housing and utilities. In Viet Nam, consumer price inflation eased to 0.9% y-o-y in July from 1.0% y-o-y in June, partly due to a slower y-o-y increase in food prices.

*     Real gross domestic product growth in the Republic of Korea decelerated in 2Q15—leveling off at 0.3% quarter-on-quarter (q-o-q) and 2.2% y-o-y—down from its 1Q15’s rates of 0.8% q-o-q and 2.5% y-o-y. In Singapore, manufacturing output decreased 4.4% y-o-y in June largely due to an output contraction in five out of six industry clusters.

*     Japan's merchandise trade deficit narrowed to JPY69 billion in June from JPY217 billion in May as exports of goods increased 13.3% month-on-month (m-o-m), compared with a 10.4% m-o-m hike in importable items. The Philippines’ merchandise trade balance shifted to a surplus of US$509 million in May from a deficit of US$337 million in April as merchandise exports rose 12.0% m-o-m and imports fell 6.8% m-o-m. 

*     Corporate debt issuance in the Republic of Korea rose 15.0% y-o-y to KRW63.5 trillion in 1H15, led by y-o-y increases in the issuance of bank debentures, non-bank financial bonds, and non-financial corporate bonds.

*     China Minmetals Corporation—through its subsidiary, Minmetals Bounteous Finance—last week priced a US$500 million 5-year bond on a 3.5% coupon to yield 3.61%, and a US$500 million 10-year bond on a 4.75% coupon to yield 4.768%. China Oilfield Services Limited (COSL), through its issuer COSL Singapore Capital, priced a US$500 million 5-year bond on a 3.5% coupon to yield 3.606%, and another US$500 million worth of 10-year bonds carrying a 4.5% coupon to yield 4.577%.   

*     Goldwind Science & Technology, a wind power company based in the People’s Republic of China (PRC), issued a US$300 million 3-year green bond on a 2.5% coupon to yield 2.653% last week.

*     Indonesia priced a EUR1.25 billion 10-year bond carrying a coupon of 3.375% to yield 3.555% last week. Tisco Bank in Thailand sold a THB600 million 1-year debenture at a yield of 1.75%, a THB6 billion 1.5-year debenture at 1.875%, and a THB1.9 billion 2-year debenture at 2.00%.

*     The Monetary Authority of Singapore launched on 21 July the Singapore Savings Bond Programme, which will offer debt securities solely for individual investors. The Singapore Savings Bond will first be issued on 1 October 2015 and every subsequent month for at least 5 years.

*     The Financial Services Commission of the Republic of Korea announced last week a set of measures aimed at managing the economy’s household debt.

*     Government bond yields fell last week for all tenors in the Republic of Korea and for most maturities in the PRC, Indonesia, and Malaysia. Yields rose for most tenors in Singapore and Thailand. Yield movements were mixed in Hong Kong, China; the Philippines; and Viet Nam. Yield spreads between 2- and 10-year tenors widened in Indonesia and the Philippines, remained unchanged in the PRC, and narrowed in Hong Kong, China; the Republic of Korea; Malaysia; Singapore; Thailand; and Viet Nam.

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