In contrast with the US, Demand for Lebanese Eurobonds Rose over the Past Week

The Lebanese Eurobonds market regained some vigour over the past week with the BLOM Bond Index (BBI) gaining a weekly 0.25% to 103.62 points.

The Lebanese gauge was outpaced by the JP Morgan Emerging Markets’ Bond Index which increased by a weekly 1.44% to 689.05 points.

Higher demand was registered for both medium and long-term Lebanese Eurobonds as the 5Y and 10Y yields fell from last week’s 6.37% and 6.80% to 6.26% and 6.77%, respectively.

Demand for safe haven US treasuries sharply fell over the past week after positive economic data was released. 5 Year and 10 Year yields in the US rose from 1.16% and 1.71% to 1.33% and 1.83%, respectively. In fact, new orders for US factory goods showed their largest increase since June and investors hold upbeat expectations regarding the upcoming US employment data.    

Accordingly, the spread between the yields on the 5Y and 10Y Lebanese Eurobonds and their US comparable narrowed from 521 bps and 509 bps to 493 bps and 494 bps, respectively.  

5 Year Credit Default Swaps, Mid-Prices (in basis points)

In contrast with the US, Demand for Lebanese Eurobonds Rose over the Past Week

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