A monthly review and outlook of the Asian Quality Bond market.

Key highlights - as at March 2016   

 

  • A rebound in oil price, stabilisation of the renminbi and a decrease in expectation of the number of rate hikes by the US Fed led to a strong rally in Asian credits.
  • Moody’s lowered China’s Aa3 government bond rating outlook to negative from stable. On the following day, they lowered the outlook of 38 Chinese State-Owned Enterprises.
  • Challenging times are ahead for Asia though we see some bright spots. Reforms in China, India and Singapore are long-term positive despite the near-term growth uncertainty.
  • Longer-term growth prospects in Asia remain intact and return from local currency bonds especially the high yield Indonesia and India will likely outperform those of developed market if investors are able to take a longer-term view and ride out the current volatility.
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