The US Fed looks set to cut rates tonight, but will it be by 25 basis points or 50? I’m more inclined to think they’ll be slow. The market seems split 50:50.
We have a very good article from Dr Stephen Foerster of the Ivey Business School outlining what happens to markets when rates are cut. Tim Murray from T. Rowe Price shares his views on the impending US rate cut and the US labor market.
Multi-asset strategists are looking for value across markets so they bring a unique perspective and I was delighted this week to speak to regular FINA contributor, Thomas Poullaouec from T. Rowe Price. The new podcast covers a lot of ground quickly. I asked questions about a hard or soft landing, whether equity markets have further to run, specific fixed income sub-sectors, and Asian-based Poullaouec gave us special insight into China, Japan and the South Sea Island conflict. I hope you enjoy listening to it as much as I enjoyed talking to him.
Recent corporate bond action has slowed but here are some of the recent deals that caught my eye:
- NSW Ports issued $550m in a dual tranche, fixed senior secured bond:
- $250m over seven years with a coupon of 5.042%
- $300m over 10 years with a coupon of 5.432%
- Westpac issued $2,700m in a dual tranche, senior unsecured bond over five years:
- $2,500m floating rate tranche at 3-month BBSW +85bps
- $200m fixed rate tranche with a 4.35% coupon
- Toyota Finance issued $675m in three tranches:
- $125m floating rate over 3 years at 3 month BBSW+90 bps
- $200m floating rate over 5 years at 3m BBSW +115bps
- $350m fixed rate over five years at a 4.65% coupon rate.
Finally, we have an interesting contribution from Moody’s regarding residential mortgage-backed securities (RMBS) arrears rates.
Have a good week!
