| SGS |
6-Aug |
13-Aug |
change |
IRS |
6-Aug |
13-Aug |
change |
BASIS |
6-Aug |
13-Aug |
change |
| 2Y |
0.17 |
0.20 |
0.03 |
2Y |
0.51 |
0.50 |
(0.01) |
2Y |
(12.00) |
(12.13) |
(0.13) |
| 5Y |
0.41 |
0.39 |
(0.02) |
5Y |
0.92 |
0.85 |
(0.08) |
5Y |
(36.25) |
(38.25) |
(2.00) |
| 10Y |
1.43 |
1.37 |
(0.06) |
10Y |
1.74 |
1.67 |
(0.07) |
10Y |
(43.00) |
(44.13) |
(1.13) |
| 15Y |
1.71 |
1.67 |
(0.04) |
15Y |
2.20 |
2.14 |
(0.06) |
15Y |
(57.00) |
(57.00) |
– |
| 20Y |
2.05 |
2.05 |
(0.00) |
20Y |
2.61 |
2.55 |
(0.06) |
20Y |
(63.50) |
(65.00) |
(1.50) |
| 30Y |
2.37 |
2.37 |
(0.01) |
30Y |
2.84 |
2.76 |
(0.08) |
|
|
|
|
USD/SGD 1.2450 (+0.0032) approx 163 bp Above NEER (prev 192ABOVE).
6M SOR 0.53132-0.56605% SGS Inflow Outflow (-5/+5) : +1
Auctions
MAS 28 Day Bill SGD 1.2 bio (unch) cut off 0.28% (+3 bp)
MAS 3M Bill SGD 2 bio (UNCH) cut off 0.28% (Unch )
SGS 3M bill SGD 3 bio (unch) cut off 0.25% (unch)
Economic Data
GDP 2Q12 Final QoQ -0.7% (exp +0.5%) YoY +2% (exp +2.2%)
IRS :
SG rates ignored the US moves as local sub debt hedging distorted entire curve. Local bank sold 5Y-6Y irs to the tune of SGD 1 bio in the street during the week on the back of their SGD 1 bio 5.5Y sub debt issue last Mon. Thus, although fixings rose as SGD backed off its highs on the NEER band, especially after a weaker 2Q GDP number and a benign inflation outlook. However rates continued their downslide throughout the week as market struggled and failed to digest the size of the flow. Short ends were supported due to fixings for curve to close the week 1 to 8 bp lower, the 5Y outperforming vs the rest of the curve.
Comment :
Higher rates rejected as SGD is expected to stay strong as the economy avoids a technical recession as purported by the authorities. It does look like rates could trend lower if the Eurodollar futures continue to sell off and lead to lower SOR fixings. For once we should pay attention to the NODX numbers this Friday and the CPI next week to ascertain the direction of the USD/SGD bearing in mind that a recessionary outlook would probably lead to higher rates in the months ahead.
SGS :
Bonds were bought up on 2 main factors. Firstly, the SGD 1 bio of irs that hit the street led to panic hedging in the bonds to very poor results(bond swaps contracted). Second was the news of SNB’s foreign reserve holdings which exploded and led to speculation that they would diversify into AAA currencies such as the SGD and thus, SGS. Yields failed to rise even on Friday after the same local seller of the irs unloaded about SGD 100 mio of belly papers, in particular the highest premium bond on the curve – the Sep 2018, giving some foreign PDs the oppotunity to purchase 10Y SGS and Mar27 papers ahead of anticipated client demand. Yields closed the week +3 to -6 bp changed, on a much flatter curve as the short end remains plagued by higher funding rates.
Comment :
Corporate issuance continue to flood the market which probably means bonds will not outperform anytime soon. It remains to be seen if exogenous demand from sources such as foreign central bank diversification of reserves will play a part in supporting prices going ahead. A light book would be the most prudent choice for now.
Corporate Bonds
1. DBS LT2 “Old Style” A+ (parent Aa1/AA-) SGD 1 bio 3.1% (SOR+215 bp)- lowest ever coupon for a SGD Bank Subdebt.
2. Keppel Telecommunications & Transportation KPTTSP2.625 08/19 nc5Y. SGD 120 mio 7NC5 2.625% (SOR+195) step up 3.825% on Yr5.
3. Ascott Capital Pte Ltd 7Y (Guarantor Ascott Limited UNRATED) CAPLSP3.78% (SOR+260 bp) SGD 300mio. OCBC.
Pipeline
1. NTUC Income Insurance Co-operative Limited sub debt benchmark size ie. >SGD 300 mio.
Read Full Post »
singrates 
SGD Rates Trading Week In Review 13Aug12
Posted in ASCOTT CAPITAL PTE LTD 7Y, basis swaps, CAPLSP3.78 08/19, Commentary, DBS LT2 3.1% SUB DEBT, DBSSP3.1 02/2023, KEPPEL T&T 7Y, KPTTSP2.875 08/19, MAS BILLS, NTUC INCOME INSURANCE COOPERATIVE SUB DEBT, SGD CORPORATE BONDS, SGD CORPS, SGS, Sing Rates Editorial, SINGAPORE GOVERNMENT BONDS, singapore interest rates, SOR FIXING, USD/SGD on August 13, 2012| 1 Comment »
USD/SGD 1.2450 (+0.0032) approx 163 bp Above NEER (prev 192ABOVE).
6M SOR 0.53132-0.56605% SGS Inflow Outflow (-5/+5) : +1
Auctions
MAS 28 Day Bill SGD 1.2 bio (unch) cut off 0.28% (+3 bp)
MAS 3M Bill SGD 2 bio (UNCH) cut off 0.28% (Unch )
SGS 3M bill SGD 3 bio (unch) cut off 0.25% (unch)
Economic Data
GDP 2Q12 Final QoQ -0.7% (exp +0.5%) YoY +2% (exp +2.2%)
IRS :
SG rates ignored the US moves as local sub debt hedging distorted entire curve. Local bank sold 5Y-6Y irs to the tune of SGD 1 bio in the street during the week on the back of their SGD 1 bio 5.5Y sub debt issue last Mon. Thus, although fixings rose as SGD backed off its highs on the NEER band, especially after a weaker 2Q GDP number and a benign inflation outlook. However rates continued their downslide throughout the week as market struggled and failed to digest the size of the flow. Short ends were supported due to fixings for curve to close the week 1 to 8 bp lower, the 5Y outperforming vs the rest of the curve.
Comment :
Higher rates rejected as SGD is expected to stay strong as the economy avoids a technical recession as purported by the authorities. It does look like rates could trend lower if the Eurodollar futures continue to sell off and lead to lower SOR fixings. For once we should pay attention to the NODX numbers this Friday and the CPI next week to ascertain the direction of the USD/SGD bearing in mind that a recessionary outlook would probably lead to higher rates in the months ahead.
SGS :
Bonds were bought up on 2 main factors. Firstly, the SGD 1 bio of irs that hit the street led to panic hedging in the bonds to very poor results(bond swaps contracted). Second was the news of SNB’s foreign reserve holdings which exploded and led to speculation that they would diversify into AAA currencies such as the SGD and thus, SGS. Yields failed to rise even on Friday after the same local seller of the irs unloaded about SGD 100 mio of belly papers, in particular the highest premium bond on the curve – the Sep 2018, giving some foreign PDs the oppotunity to purchase 10Y SGS and Mar27 papers ahead of anticipated client demand. Yields closed the week +3 to -6 bp changed, on a much flatter curve as the short end remains plagued by higher funding rates.
Comment :
Corporate issuance continue to flood the market which probably means bonds will not outperform anytime soon. It remains to be seen if exogenous demand from sources such as foreign central bank diversification of reserves will play a part in supporting prices going ahead. A light book would be the most prudent choice for now.
Corporate Bonds
1. DBS LT2 “Old Style” A+ (parent Aa1/AA-) SGD 1 bio 3.1% (SOR+215 bp)- lowest ever coupon for a SGD Bank Subdebt.
2. Keppel Telecommunications & Transportation KPTTSP2.625 08/19 nc5Y. SGD 120 mio 7NC5 2.625% (SOR+195) step up 3.825% on Yr5.
3. Ascott Capital Pte Ltd 7Y (Guarantor Ascott Limited UNRATED) CAPLSP3.78% (SOR+260 bp) SGD 300mio. OCBC.
Pipeline
1. NTUC Income Insurance Co-operative Limited sub debt benchmark size ie. >SGD 300 mio.
Read Full Post »