Positive Jobs Data Push US Treasury Yields Higher
The BLOM Bond Index (BBI) ended the week at 99.70 points, adding a weekly 0.11% and thereby outpacing the JP Morgan Emerging Markets’ Bond Index (EMBI) which gained a marginal 0.08% to end the week at 790.69 points.
The demand for 5 year (5Y) Eurobonds grew as yields dropped from 6.95% to 6.94%; however, demand for 10Y Eurobonds fell over the week with yields rising from 7.70% to 7.73%.
Investors retreated from safe-haven investments this week as the the economy added 313,000 jobs in February, far surpassing Wall Street expectations. This was reflected in the yields on the 5Y and 10Y US treasuries, which grew from 2.58% and 2.81% last week to 2.63% and 2.86% this week, respectively.
Accordingly, the 5Y spread between the yield on the Lebanese Eurobonds and its US comparable shrank from 437 basis points (bps) last week to 431 bps, and the 10Y spread narrowed from 489 bps last week to 487 bps this week.
5 Year Credit Default Swaps, Mid-Prices (in basis points)
| 08/03/2018 | 01/03/2018 | |
| Lebanon | 449 | 453 |
| KSA | 77 | 79 |
| Dubai | 97 | 101 |
| Brazil | 152 | 160 |
| Turkey | 169 | 172 |
Weekly Change of Lebanese Eurobonds Prices
| Prices | Weekly | Yields | Weekly | ||||
| Maturity | Coupon in % | 08/03/2018 | 01/03/2018 | Change | 08/03/2018 | 01/03/2018 | Change bps |
| 23/04/2019 | 5.5 | 99.13 | 99 | 0.13% | 6.31% | 6.41% | -11 |
| 20/05/2019 | 6 | 99.6 | 99.5 | 0.10% | 6.34% | 6.42% | -8 |
| 28/11/2019 | 5.45 | 98.25 | 98.25 | 0.00% | 6.53% | 6.52% | 1 |
| 09/03/2020 | 6.375 | 99.38 | 99.38 | 0.00% | 6.71% | 6.71% | 0 |
| 14/04/2020 | 5.8 | 98.2 | 98.2 | 0.00% | 6.73% | 6.72% | 1 |
| 19/06/2020 | 6.15 | 98.75 | 98.75 | 0.00% | 6.74% | 6.74% | 0 |
| 12/04/2021 | 8.25 | 103.75 | 103.75 | 0.00% | 6.88% | 6.89% | -1 |
| 04/10/2022 | 6.1 | 96.63 | 96.5 | 0.13% | 6.97% | 7.00% | -3 |
| 27/01/2023 | 6 | 95.88 | 95.75 | 0.14% | 7.01% | 7.04% | -3 |
| 22/04/2024 | 6.65 | 97.25 | 96.88 | 0.38% | 7.21% | 7.29% | -8 |
| 04/11/2024 | 6.25 | 94.63 | 94.5 | 0.14% | 7.28% | 7.30% | -2 |
| 03/12/2024 | 7.00 | 98.38 | 98.25 | 0.13% | 7.31% | 7.33% | -2 |
| 26/02/2025 | 6.20 | 93.88 | 93.75 | 0.14% | 7.34% | 7.36% | -2 |
| 12/06/2025 | 6.25 | 93.75 | 93.63 | 0.13% | 7.37% | 7.39% | -2 |
| 28/11/2026 | 6.60 | 93.63 | 93.63 | 0.00% | 7.61% | 7.61% | 0 |
| 23/03/2027 | 6.85 | 94.25 | 94.38 | -0.14% | 7.75% | 7.72% | 2 |
| 29/11/2027 | 6.75 | 93 | 93.13 | -0.14% | 7.79% | 7.77% | 2 |
| 03/11/2028 | 6.65 | 91.25 | 91.38 | -0.14% | 7.88% | 7.86% | 2 |
| 26/02/2030 | 6.65 | 90 | 89.75 | 0.28% | 7.96% | 7.99% | -3 |
| 22/04/2031 | 7.00 | 91.88 | 91.75 | 0.14% | 8.01% | 8.03% | -2 |
| 23/03/2032 | 7.00 | 91.5 | 91.25 | 0.27% | 8.02% | 8.05% | -3 |
| 02/11/2035 | 7.05 | 91 | 90.5 | 0.55% | 8.01% | 8.07% | -6 |
| 23/03/2037 | 7.25 | 91.75 | 91 | 0.82% | 8.11% | 8.19% | -8 |
