Q&A: Why AllianzGI sees value in HY credit

David Tan, Asia-Pacific fixed income CIO at Allianz Global Investors, tells FinanceAsia why he is bullish on the Asia ex-Japan high-yield bond market, despite a terrible 2018.

2018 was one of the most disappointing years in recent times for the Asian high yield bond market outside of Japan. 

Despite enjoying a decent start to the year, the market started suffering as soon as the second quarter kicked off, hit by a double-whammy of expectations for higher US interest rates and concerns over escalating global trade tensions.

Throughout the year, average dollar bond yields in the high-yield market widened from 7% to 9%. Subdued demand led to a sharp decline in supply of new high-yield bonds after April, and the market remained largely muted for the rest of the year.

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