indonesia-bond-is-acid-test-for-markets

Indonesia bond is acid test for markets

Credit markets have got off to a good start in 2009, but Indonesia could find that sentiment is changing.

Bond markets are always the same at this time of year. Investors have lots of cash they need to invest and smart issuers take advantage of the liquidity, paying sensible new issue premiums and generally being flexible and accommodating. It is a happy time.

As January rolls on, borrowers get greedier and premiums come down. El Paso, an American junk-rated natural gas producer, is a particularly good example of how the rally has affected pricing. In December it paid investors a yield of 15.25% on its $500 million bond. Last week, it paid 9.25% on a carbon copy trade. Nothing had changed to make the company a less risky proposition -- it was...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222