Asian USD bonds have exceeded all expectations by producing a total return of 9% in the first eight months of the year, driven by the search for yield, reasonable macro environment and supportive technical factors. At this stage, the bond yields for both investment-grade and high-yield bonds are approaching the tightest levels in the last five years. However, Asian bonds still offer a higher yield than the US domestic bonds.
As concerns over China’s growth have abated to some extent and India’s growth has picked up, Asia’s growth is forecast to exceed that of other regions and to stay stable for the next three years. Yet, concerns are rising over the increased leverage on corporate balance sheets and the excess of rating downgrades over upgrades. Looking ahead, technical factors are likely to continue to support Asian bonds. They will continue to present an attractive opportunity to global investors, particularly against the preponderance of negative interest rates elsewhere.
To download full report, click here.
As concerns over China’s growth have abated to some extent and India’s growth has picked up, Asia’s growth is forecast to exceed that of other regions and to stay stable for the next three years. Yet, concerns are rising over the increased leverage on corporate balance sheets and the excess of rating downgrades over upgrades. Looking ahead, technical factors are likely to continue to support Asian bonds. They will continue to present an attractive opportunity to global investors, particularly against the preponderance of negative interest rates elsewhere.
To download full report, click here.
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