Latest news with #bonds
Argaam
a day ago
- Business
- Argaam
Saudi Aramco prices 3-part bond sale at $5B: Report
Saudi Aramco priced its dollar-denominated three-part bonds at $5 billion and set their yield spread, Reuters reported, citing fixed income news service IFR. The Saudi oil giant priced its five-year debt sale at $1.5 billion with spread at 80 basis points (bps) over US Treasuries. The 10-year portion spread was set at 95 bps with a price of $1.25 billion, while its 30-year portion spread was set at 155 bps with a price of $2.25 billion, the report said. According to data available on Argaam, Saudi Aramco announced, on May 27, plans to issue international bonds under its US-denominated Global Medium Term Note Programme. The net proceeds from each bond issuance will be used by Saudi Aramco for general corporate purposes or any other purpose specified in the final terms for a series of bonds.
Argaam
a day ago
- Business
- Argaam
Aramco publishes new sukuk issuance prospectus
Saudi Aramco published a new prospectus for its sukuk issuance program, signaling the state oil major may soon tap the debt markets. The prospectus, submitted to the London Stock Exchange where the sukuk would be listed, is dated May 30, Reuters reported. Aramco has a year to issue sukuk under its terms. The oil giant priced its dollar-denominated three-part bonds at $5 billion and set their yield spread, according to Argaam data. The net proceeds from each bond issuance will be used by Saudi Aramco for general corporate purposes or any other purpose specified in the final terms for a series of bonds.
Bloomberg
a day ago
- Business
- Bloomberg
US Treasuries Set for First Monthly Loss of 2025 on Deficit Woes
US Treasuries are on track to deliver their first monthly loss this year, buffeted by renewed tariff uncertainty and growing anxiety over mounting levels of government debt. A Bloomberg index that tracks the bonds is down more than 1.2% in May after all maturities came under pressure. The 30-year yield rose for a third consecutive month, its longest losing streak since 2023, while yields on two- and 10-year tenors posted their first monthly increase this year.
Bloomberg
a day ago
- Business
- Bloomberg
South Africa's Kganyago Provides Fuel for Best Bond Return in EM
South Africa's central bank chief has given the country's local-currency bonds another reason to add to their market-leading returns. Investors are piling into the debt after South African Reserve Bank Governor Lesetja Kganyago argued strongly on Thursday for a reduction of the inflation target which, he said, would boost growth and lead to lower interest rates in the long term. Yields on 10-year government bonds plunged 16 basis points, and extended the drop on Friday to a six-month low.
Reuters
a day ago
- Business
- Reuters
German Bund anchor can shield euro area from excessive curve steepening
May 30(Reuters) - A global selloff in government bonds due to concerns over high debt and bond sales has not left the euro zone unscathed, but Germany's growing safe-haven status should shield the bloc from an excessive rise in long-term borrowing costs. Major bond markets from the United States to Japan and Europe have seen their bond curves steepen sharply - meaning long-term bond yields have risen faster than short-term yields - a challenging environment for issuers. Germany's 30-year bond yields have jumped around 40 basis points so far this year, in a move largely driven by the creation of a 500 billion euro ($546 billion) infrastructure fund and an easing of strict borrowing rules to help lift defence spending. Yet investors and analysts say that a sharp steepening across euro-area bond markets is likely to fade from here, as a relatively better debt trajectory for Germany and global tariff uncertainty bolsters the safe-haven appeal of Bunds. In an early indication of the trend, the gap between 2-year and 10-year German bond yields looks set to end May with its first monthly drop in over a year, sliding seven basis points (bps) to 74 bps. An increase in the curve slope can create challenges for highly indebted countries, which will face higher costs when they issue new bonds, as recent weak auction results in Japan and the United States highlight. It can also complicate the monetary policy outlook by triggering an unwanted tightening of financial conditions. But in Germany's case, the steepening pressure is easing for a few reasons. Higher bond supply is now priced in. Tariff uncertainty means the European Central Bank is likely to remain in easing mode. And, compared to its peers, German debt dynamics make it a better place to park cash in times of stress. Amundi's global fixed income investment officer Gregoire Pesques said Europe's biggest asset manager had taken profit on some curve steepening trades. "In Germany, we are short 2-year bonds, short the 30-year bond, and long the 10-year bond," he said. Pesques mentioned the possibility of a more dovish than expected ECB outlook given low energy prices and a strong euro, adding there was a lack of appetite for 30-year bonds as a repricing of expectations for more bond supply is under way. The euro is up around 9% this year against the dollar , and oil prices have fallen around 13%, helping dampen inflation. Konstantin Veit, portfolio manager at bond giant PIMCO, said he saw a plausible new range of 2.5 to 3.5% for 10-year Bund yields given German fiscal plans, assuming an ECB policy rate of 2%. Germany's 10-year Bund yield is trading around 2.5%, up around 15 bps so far this year, while its UK and U.S. peers are down eight and 15 bps respectively , , . Germany's yield curve is currently steeper than the United States' because the ECB has almost completed its easing cycle, while the U.S. Federal Reserve is expected to cut rates mostly in 2026, analysts said. Debt sustainability is also on investors' minds after the U.S. suffered a sharp bond selloff in early April, with investors questioning the safe-haven status of U.S. Treasuries. Since then, ratings agency Moody's has stripped the United States of its remaining triple-A credit rating and a recent 20-year bond sale was met with tepid demand. In contrast, though German debt is also rising, Europe's biggest economy is the only G7 member with a debt-to-GDP ratio below 100%, bolstering its safe-haven credentials. Notably, when U.S. and other major bond markets sold off in April, the Bund market held firm. Ratings agency S&P argues that German fiscal stimulus, expected to bolster long-term growth, supports the country's triple-A credit rating. Consultancy Saltmarsh Economics estimates that even without any nominal GDP growth, an extra 325 billion euros of debt would push Germany's debt-to-GDP ratio up to 70%, from current levels around 63%. And an extra 750 billion euros of debt would increase it to a still very low 80%. "Germany is unique in its fiscal conditions and has room to do more, but other (European) countries will have to compensate for higher defence spending in their budget," said PIMCO's Veit. We don't think European fiscal policy will be very expansionary in the next couple of years," he added.
