Bonds
Credible fiscal plans reduce pressure on sovereign bond market, study finds
A credible macro-fiscal framework ‘can lead to stable expectations’ around a country’s sovereign bond market, reducing its expected risk premium, ECB paper finds
BIS paper spots correlations in capital control effects
Study of emerging market capital controls finds bonds flow into other regional countries if one loosens its controls, but the effect is weak when countries tighten
HKMA launches new liquidity facility
Discount facility for government bonds aims to provide greater flexibility for banks in meeting liquidity needs; HKMA also moves to ‘streamline’ bond tenors
Nepalese governor sets sights on regional capital market
Yuba Raj Khatiwada identifies market infrastructure and corporate bonds as two key areas for development as Asia works towards greater capital market integration
Lagarde lauds new Mexican bonds with ‘strengthened' collective action clauses
Mexico issued $2 billion in 10-year bonds with new collective action clauses, which Lagarde says ‘will play a critical role in enhancing the architecture for sovereign debt markets’
Praet: Covered bond supply ‘dynamised’ by ECB purchases
European Central Bank executive board member Peter Praet identified ‘a number of supply side reactions’ to covered bond purchases, which hit €10.5 billion last week
ECB staff told to prepare for further measures
ECB keeps monetary policy stance unchanged; governing council tells staff to ensure the ‘timely preparation' of unspecified 'further measures’ to be implemented ‘if needed’
IMF paper examines causes of financial market spillovers
Research finds financial market spillovers are affected by ‘bilateral portfolio asset holdings, as well as a country’s geographical preferences’
Riksbank economist warns on corporate bond market
Economist at the Swedish central bank says it will become ‘increasingly important’ to consider the impact of the corporate bond market on financial stability as it expands
BIS paper investigates factors behind birth and death of benchmarks
Working paper studies ‘benchmark tipping’, finding that although many government rates are being displaced by private benchmarks, China and Brazil may develop new government bond futures markets
ECB reveals details of asset purchases
Mario Draghi would not be drawn on the size of the asset and bond programmes, but said the ‘potential universe of purchases is up to €1 trillion’
Supreme Court clears Central Bank of Sri Lanka over Greek investment
Sri Lankan governor and monetary board members cleared over investment in Greek government bonds; Supreme Court says investment decisions ‘best left to central bank’
EM East Asian bond success could be undermined by ‘tighter liquidity’
ADB says US interest rates, geopolitical tensions and a ‘slowing property market’ in China could undermine the performance of East Asian bonds
ECB and BoE seek insights into yield curve behaviour
Frankfurt conference aims to improve understanding of the yield curve in the wake of the financial crisis, at a time when European and US yields are diverging
Hong Kong's first Islamic bond raises $1bn
Five-year sukuk sells at ‘tightest spread ever achieved’ over US Treasuries; strong demand from across the globe sees orders in excess of $4.7 billion
MAS seeks to widen retail access to Singapore bond market
Singapore’s central bank proposes a host of regulatory changes to ‘make it easier’ for retail investors to buy corporate bonds
ECB paper quantifies OMT benefits
OMT announcements depressed Italian and Spanish two-year government bond yields by roughly 200 basis points, but left their French and German equivalents ‘largely unaffected’
Preferential treatment distorts banks' demand for government bonds
Transaction-level data suggests comparatively beneficial liquidity and capital regulation is incentivising banks to swap other bonds for sovereign debt
Sovereign bonds offer ‘return-less risk' says GIC's head of fixed income
The returns on offer from the biggest sovereign bond issuers offer too little return even for the small level of risk associated, says GIC's managing director in charge of fixed income
IMF paper examines banks’ public bond holdings
Working paper published by the IMF finds that large banks accumulate high-risk public bonds during sovereign crises; examines relationship with bank lending
Reserve managers look to exit bonds sooner as global ‘taper' looms
Fed taper has reserve managers fretting, new Central Banking Publications survey of 69 central banks shows; ETFs are gaining traction as reserve asset class
Bank of Ghana admits monetising government debt
Central bank offers relief as investor flight drives sovereign bond yields to spike; ‘printing money to finance the deficit' will cause inflation and currency depreciation, Fitch warns
Frontier bonds find buyers as investors reach for yield
Pakistan sells $2 billion worth of Eurobonds as investors look for alternatives to US Treasuries; Greece and Swaziland among countries to find success with bonds in own currency
Two injured as bomb blast hits Bank of Greece
Bank of Greece security personnel injured by attack hours ahead of county’s return to international bond markets and visit by German chancellor Angela Merkel