US Treasury Yields Higher over Optimism on Trade Negotiations Between US and China

Lebanon’s BLOM Bond Index (BBI) declined this week, by 2.35% to reach 85.56 points.  As such, the 5 year (5Y) and 10Y Lebanese Eurobonds, increased by 79 and 35 basis points (bps) each to reach 11.85%  and 11.21% ,respectively this week. The JP Morgan Emerging Markets’ Bond Index (EMBI) recorded a 1.08% weekly rise to stand at 783.4 points .

In the US, the yields on the (5Y) treasuries & the (10Y) treasuries witnessed a increase of 19 and 18 basis points (bps)  ending this week at 2.56% and 2.74% respectively. In fact, despite the continuous partial government shutdown over a wall Trump wants on the U.S.-Mexico border, investors were comforted this week after Chairman Jerome Powell stated that the Federal Reserve will be patient about raising interest rates and news that trade talks between Washington and Beijing are moving to higher levels which led to a rise in the global equity market.

The 5Y and 10Y spread between the yield on the Lebanese Eurobonds and their US increased from last week by 60 and 17 basis points (bps)  to reach 929 and 847 bps respectively.

 

 Weekly Change of Lebanese Eurobonds Prices

 

  Prices Weekly Yields   Weekly
Maturity Coupon in % 10/01/2019 03/01/2019 Change 10/01/2019 03/01/2019 Change bps
09/03/2020 6.375 93 95.14 -2.25% 13.03% 10.84% 219
14/04/2020 5.8 92.25 94.02 -1.88% 12.62% 10.92% 170
19/06/2020 6.15 91.63 93.64 -2.15% 12.68% 10.98% 170
12/04/2021 8.25 91.63 93.79 -2.30% 12.61% 11.41% 120
04/10/2022 6.1 83 85.18 -2.56% 11.86% 11.02% 84
27/01/2023 6 81.63 83.58 -2.33% 11.84% 11.13% 71
22/04/2024 6.65 80.38 82.63 -2.72% 11.73% 11.06% 67
04/11/2024 6.25 77.5 79.58 -2.61% 11.68% 11.09% 59
03/12/2024 7.00 80.38 82.42 -2.48% 11.69% 11.13% 56
26/02/2025 6.20 77 78.75 -2.22% 11.53% 11.05% 48
12/06/2025 6.25 76.75 79.21 -3.11% 11.46% 10.81% 65
28/11/2026 6.60 75.5 77.36 -2.40% 11.39% 10.95% 44
23/03/2027 6.85 76.25 78.19 -2.48% 11.37% 10.93% 44
29/11/2027 6.75 74.88 76.98 -2.73% 11.30% 10.84% 46
03/11/2028 6.65 73.75 75.64 -2.50% 11.11% 10.71% 40
26/02/2030 6.65 73 74.68 -2.25% 10.89% 10.57% 32
22/04/2031 7.00 73.38 74.41 -1.38% 11.00% 10.81% 19
23/03/2032 7.00 73.5 74.75 -1.67% 10.81% 10.59% 22
02/11/2035 7.05 72.63 74.5 -2.51% 10.56% 10.26% 30
23/03/2037 7.25 73 74.67 -2.24% 10.63% 10.37% 26

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