Companies in Asia are scrambling to issue bonds, but many investors just aren't biting

ArticleDeflationApril 11, 2018 - 7:28:47 AM

Companies in Asia are rushing to raise funds by issuing bonds before the U.S. Federal Reserve hikes interest rates again.

Asset managers say they've seen a number of companies fail to close dollar-denominated bond deals this year. That's especially true for companies that aren't investment grade — meaning they're judged to be at greater risk of a default — experts said.

Thomson Reuters data this week painted a very different picture from the boom seen last year: The Asian high-yield bond market shrank by 15 percent to $12.9 billion.

Year-to-date, the issuance of dollar bonds in Asia is about 10 percent lower than last year because of the increased volatility in U.S. Treasurys, said Desmond Soon, head of investment management for Asia ex-Japan at Western Asset Management. Treasury volatility has spiked this year, in tandem with the wild trading seen in stocks...

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