If there is one thing about which a large number of the great and good of the financial markets would have been wrong this year, it is where interest rates and the consequent yield on government debt would be at this juncture. Especially in the more developed markets. Taking US Treasuries as an example, this time last year, the yield was around the 3% mark and heading higher. Fast forward a year, and the level is not much more than half of its peak. In the eurozone, interest rates are not only n

Attacks on Saudi oil installations sent oil futures soaring on September 16. The impact of any geopolitical fallout plus the disruption to oil supplies certainly threw a curve ball at financial markets already battling with multiple confounding macro and micro factors. The US blaming Iran, Iran denying involvement, President Trump saying the US was ‘locked and loaded’, Iran retorting that it is ready for war. This is not the stuff to calm unnerved market sentiment. The fears are that

The received wisdom surrounding the economic platform of Japan’s Prime Minister Shinzo Abe – dubbed “Abenomics” and involving an ultra-loose monetary policy introduced in 2013 – is that is has been the primary cause of a paucity of available yields for Japanese institutional investors, who traditionally invest in JGBs and high-grade debt. That is certainly one answer, although as around 25% of the global debt stock now manifests negative yields, it can be regarded a

Heard the one about the TV comedian who became president of an economically stressed country and vowed to turn it around? So far, investors have proved to be a welcoming audience for Volodymyr Zelensky, after he was elected in April with 75% of the vote on an anti-corruption ticket. Zelensky’s commitment to reforms triggered a rally in Ukranian bonds that was sufficient to tempt its treasury to tap the international bond markets in June, when it printed its first euro benchmark deal for 15

Investors in the world’s most indebted oil company have a multi-billion-dollar headache. In June, Petroleos Mexicanos, or Pemex, Mexico’s state-owned oil giant, had its credit rating cut to junk by Fitch Ratings. A subsequent rating downgrade by Moody’s – which currently ranks Pemex just one notch above junk – could trigger billions of dollars of forced selling as fund managers with investment-grade-only mandates are obliged to dump their holdings. That could cause

When Nepal’s name is mentioned, it is typically in connection with human calamities – usually climbing accidents in the Himalayas – or natural disasters. When floods, earthquakes and landslides hit, people die and property is destroyed. Little surprise that for the longest time, the gaze of investors bypassed this poor and landlocked South Asian state. There was not much to look at: no oil or gas, a dearth of natural resources, middling growth, and a population that, while aspi

Pakistan’s economic woes – which place the country at the risk of insolvency – the unpopularity of its government just over one year into the leadership of Imran Khan against a backdrop of structural political instability, and its affliction with widespread corruption all point to its likely categorisation as a failed state. But there is cause for optimism within this morass. Across a range of economic metrics, things do not look pretty in Pakistan: GDP growth is projected to c

Optimism was high when Jair Bolsonaro became president of Brazil at the beginning of the year. Economists were predicting growth of around 3% in 2019 – a marked improvement on the roughly 1% achieved in 2018 and 2017 as the country slowly emerged from its worst recession on record. International investors were encouraged by Bolsonaro’s market-friendly tone and ambitious economic reform agenda. The Brazilian stock market has been soaring to record highs. Yet the surge in growth has fa

Africa’s total amount of outstanding sovereign Eurobond issuance surpassed US$103bn in July, according to Renaissance Capital. A total of 21 African countries have now issued sovereign Eurobonds denominated in US dollars or euros – with maturities of up to 30 years – up from only 10 countries in 2010. African sovereigns raised some US$12bn-equivalent in dollar and euro-denominated Eurobonds in the first half of 2019 – US$7.6bn in the first quarter and US$4.4bn in the seco

In August, the IMF had programmes with 19 African countries. It had disbursing arrangements with 16 nations – up from nine in 2017 and 14 in 2014 – and the total agreed amount of the IMF’s outstanding disbursing arrangements with African countries jumped to around US$10.9bn at the end of July from US$3.4bn in 2014, according to Fitch Ratings. For sub-Saharan countries, the sum increased to US$8.3bn from US$1.8bn during the same period. The IMF is providing financial support in

At the end of the 19th century, the country that is now Turkey was known as the “sick man of Europe”, thanks to its economic problems, socio-political difficulties and the way that its standing on the world stage had diminished. It is not too much of a stretch to suggest that for much of 2018, modern-day Turkey sat in a similar position. But even as some economists have predicted a double-dip recession for much of the year, at the beginning of September, the country reported much bet