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MENA Daily Fixed Income Report - 12 December

Majed Salah
By Majed Salah
4 years ago
MENA Daily Fixed Income Report - 12 December

Sukuk


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  1. MENA Daily Fixed Income Report Kuwait Financial Centre “Markaz” News Update – 12 December 2019 Kuwait’s external debt expands 20% in Q2 2019 – Kuwait’s external debt swelled by 20.2% in the second quarter of 2019, from a year ago, the Central Bank of Kuwait (CBK) said on Tuesday. Kuwait’s total external debt, comprising debt of government and private sector debt, amounted to KWD 19.348 billion ($63.87 billion) in the period between April and June, compared with KWD 16.103 billion ($53.16 billion) the year-earlier period. Furthermore, Kuwaiti external debt expanded by 4.7% quarter-on-quarter from KWD 18.481 billion ($61.01 billion) in the first quarter of this year. Saudi Arabia ready to issue new international bonds as soon as January – Saudi Arabia might issue new international bonds as soon as January, as part of plans to raise $32 billion worth of debt next year, a senior finance ministry official told Reuters. Local issues are expected to account for 55% of the total debt issuance plan, and the remainder will be raised internationally, Fahad al-Saif, who heads the kingdom's debt management office (DMO), said in an interview. Dubai economy to grow at 3.2% in 2020, media office says – Dubai's economy will grow 3.2% in 2020, accelerating from expansion of 2.1% in 2019, the Department of Economic Development (DED) was cited as saying in a Twitter posting by the Dubai Media Office. The economy grew 1.94% in 2018, its slowest pace since a contraction in 2009, when it was hobbled by a debt crisis caused by a property crash. Dubai - with a diversified trade and tourism economy and one of the seven territories of the United Arab Emirates - has faced a slowing real estate market for most of the decade, barring a brief pickup more than five years ago. Housing oversupply has driven prices down at least a quarter since 2014. Dubai is banking on Expo 2020 to boost economic activity as the event could attract 11 million foreign visitors, organisers have said. Fed Leaves Rates on Hold; Forecasts Show No Change Through 2020 – The Federal Reserve left interest rates unchanged and signaled it would stay on hold through 2020, keeping it on the sidelines in an election year while also opening the possibility it might buy short-term coupon-bearing securities to ease money-market strain. “Our economic outlook remains a favorable one despite global developments and ongoing risks,” Chairman Jerome Powell told a press conference Wednesday in Washington following the decision. “As long as incoming information about the economy remains broadly consistent with this outlook, the current stance of monetary policy likely will remain appropriate.” GCC Sovereign Yields (12 December 2019) Maturity Yield % Abu Dhabi 2027 2.37 Price ∆ (YTD %) 9.62 Maturity Yield % KSA 2025 2.37 Price ∆ (YTD %) 8.52 Abu Dhabi 2047 3.20 21.23 KSA 2029 2.85 12.29 Bahrain 2024 3.54 8.23 KSA 2049 3.86 23.51 Bahrain 2029 4.76 16.92 Oman 2025 4.35 12.72 Bahrain 2047 5.99 23.60 Oman 2029 5.75 1.56 Dubai 2023 2.44 4.16 Oman 2048 6.97 16.95 Sovereigns Dubai 2029 3.10 Sovereigns 9.94 Qatar 2024 2.15 Sovereign Ratings Moody’s S&P Abu Aa2 AA Dhabi Bahrain B2 B+ AA AA Oman Ba1 BB BB+ Qatar Aa3 AA- AA- 4.67 KSA A1 A- A Aa2 NR NR B2 B 2022 1.88 3.38 Qatar 2028 2.49 9.87 Kuwait 2027 2.30 7.97 Qatar 2049 3.47 24.20 Egypt Source: Bloomberg Bonds and Sukuk Indices (12 December 2019) 1D ∆ (%) 0.13 Duration (yrs) 7.33 YTD ∆ (%) 14.03 S&P MENA Bond and Sukuk Index 2.95 NA 0.14 13.40 Bloomberg Emerging Markets USD Index 4.99 6.28 0.21 11.96 Bloomberg Global Aggregate Index 1.43 7.27 0.14 6.51 Interbank Rates (%) KIBOR SAIBOR BHIBOR QATAR AEIBOR EURIBOR LIBOR 3 Months 12/12/2019 31/12/2018 2.7500 2.3125 2.2386 2.9750 2.3500 3.5500 2.2625 2.9056 2.2302 2.8375 -0.3930 -0.3090 1.8873 2.8076 6 Months 12/12/2019 31/12/2018 3.0000 2.5625 2.2529 3.1150 2.7500 4.0833 2.3625 3.0889 2.1815 3.1849 -0.3330 -0.2370 1.8786 2.8756 USD Swap Rates 1-Year 2-Year 5-Year 7-Year 10-Year 30-Year Yield % 1.7307 1.6278 1.6106 1.6480 1.7279 1.9057 YTD ∆ (%) -37.3 -38.7 -37.3 -37.2 -36.2 -32.9 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 12/12/2019 31/12/2018 3.1875 2.8125 2.3029 3.3413 2.8500 4.7000 2.6125 3.3028 2.4350 3.5737 -0.2690 -0.1170 1.9329 3.0054 Currencies 1D ∆ (bps) -0.05 0.02 0.21 0.47 0.74 0.40 KWD SAR BHD QAR OMR AED USD 0.3036 3.7504 0.3771 3.6665 0.3855 3.6731 UK Guilts Yield % 1.61 1.64 1.80 2.23 1D ∆ (%) 0.01 0.00 -0.03 -0.05 Yield % 0.55 0.58 0.77 1.27 1D ∆ (bps) 0.0593 -0.0027 0.0027 -0.0437 -0.0026 0.0027 YTD ∆ (%) 0.03 0.03 -0.03 -0.28 0.00 -0.01 German Bunds 1D ∆ (%) 0.03 0.10 0.24 0.48 Yield % -0.65 -0.58 -0.33 0.20 1D ∆ (%) 0.00 0.08 0.26 0.73 B+ Lebanon Caa2 CCC CCC Turkey B1 B+ BB- Tunisia B2 NR Morocco Ba1 BBB- B+ BBB- Jordan B1 B+ China A1 A+ A+ UK Aa2 AA AA USA BB- Aaa AA+ AAA USD YTD ∆ 5-Year CDS (%) Abu Dhabi 37.630 -41.36 Kuwait 37.920 -38.16 Dubai 88.730 -26.55 Bahrain 180.910 -34.45 Qatar 37.700 -52.00 KSA 62.480 -38.65 Egypt 291.510 -27.78 Lebanon 2304.060 212.90 Turkey 305.661 -14.95 Iraq 394.750 -12.98 Morocco 81.940 -16.90 China 37.232 -43.56 France 16.270 -53.32 Germany 7.540 -36.36 Japan 21.019 -10.02 UK 16.880 -52.02 US 12.840 -30.00 This report has been prepared and issued by Kuwait Financial Centre K.P.S.C. (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report can not be published. A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report. BB- Aa2 Kuwait Yield % 3.21 AA Kuwait UAE Index Name Bloomberg GCC FI Index Fitch