Slightly Improving Demand for Safe Haven Assets Experienced this Week

The Lebanese Eurobonds improved for the second week running, with the BLOM Bond Index (BBI) adding a mere 0.08% to 103.63 points.

Nevertheless, the Lebanese gauge could not outperform the JP Morgan Emerging Markets’ Bond Index which increased by a weekly 0.32% to 703.01 points.

Demand for both medium and long-term Lebanese Eurobonds slightly progressed as shown by the 5Y and 10Y yields which barely lost 1 basis point (bp) each to 6.25% and 6.77%, respectively.

Similarly, demand for US treasuries increased over the week as investors hurried towards safehaven assets after Brussels attacks. Hence, the 5 Year and 10 Year yields in the US decreased from 1.39% and 1.91% to 1.37% and 1.88%, respectively.

Therefore, the spread between the yields on the 5Y and 10Y Lebanese Eurobonds and their US comparable widened by 1 bp and 2 bps to end the week at the 488 bps and 489 bps, respectively.  

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