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Note: A strong Asian bid returned to the Australian dollar market after Chinese New Year as a range of credits printed oversubscribed deals that were increased from their original launch size. However, opinions were split as to whether the market could maintain its record breaking momentum.
Supranational and agency names such as Rentenbank, Export Development Canada and Asian Development Bank all tapped the market this week. Meanwhile, General Electric Capital Australia was also in the market.
However, opinions differed over the sustainability of supply in the Australian dollar market. January was a record breaking month in terms of issuance and February has seen similar momentum.
Issuers such as Rentenbank predict a slowdown. "The rate of supply in the market will not continue at the current pace," said Stefan Goebel, who runs Rentenbank's treasury.
"February started quite well but issuance volume is bound to decrease at some point."
Nevertheless, unwavering investor demand augmented this week by stronger Asian participation has left dealers more optimistic. "I don't expect market activity to slow down any time soon as investor appetite continues to be robust both on a domestic and offshore basis," said Justyna Janas, director of syndicate and DCM at National Australia Bank.
Post-holiday highs
The strength of demand for Australian dollar triple-A rated bonds drove oversubscription in the Asian Development Bank's A$700m 6% seven year note from Wednesday, said lead managers.
Domestic balance sheets and real money investors dominated the trade placing the two largest tickets but it was Asian investors who drove growth in the deal size with orders placed on...