Bond deals in Asia are getting hit because of rising interest rates

Finance


A number of first-time high-yield bond issuers from India to Indonesia has been unable to get deals done over the past two months, said Dhiraj Bajaj, head of Asia fixed income at private bank Lombard Odier.

Simultaneously, he added, debt deals have gotten smaller.

Even deals offering higher interest rates have proven insufficient to attract investors, said Froehlich.

“The reality is that capital flows into Asian bonds have moderated recently. Therefore, there is naturally less pressure from money managers to put money at work, and they can afford to wait, pass on a few deals and monitor whether and where their end-investors might re-allocate their cash,” he said.

Just last year, Asia bond markets were seeing a record boom with a string of jumbo deals. Companies in Asia Pacific issued about $500 billion worth of dollar-denominated bonds last year, according to data from Dealogic.



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