CEE Bonds

Hungary printed its €1bn seven year bond on Tuesday with the lowest ever coupon and yield for a dollar or euro bond from the issuer.

The orderbook for Republic of Hungary’s seven year euro benchmark has blasted past €2bn and leads have tightened price guidance — a move expected by rivals as they said initial talk looked cheap.

The Republic of Albania will go on the road to promote a euro benchmark transaction for the first time in three years.

The Middle East is continuing its domination of the CEEMEA primary market and even the Latin America new issue market is starting to see some action as a run of successful bonds in the last fortnight is helping to bolster investor confidence.

HSBC DCM banker Odilbek Isakov has been hired to run Uzbekistan’s new debt management office.

The Russian central bank announced a 25bp rate hike on Friday in a move calculated to offset the effect of expected US sanctions.

It is the 10th anniversary of Lehman’s collapse and we are being inundated with retrospectives and predictions of what will cause the next crisis. Many are pointing towards emerging markets as a likely catalyst, a logical conjecture given the tightening in monetary policy that is underway in the US.

The Central Bank of Turkey delivered a larger-than-expected interest rate hike this week that was given a cautious welcome by emerging markets bond syndicate bankers hoping to see some stability in the lira. Loans bankers working on a crucial $930m loan refinancing for Akbank — seen as a litmus test of foreign lenders' appetite to roll over loans to the financial sector — were nonplussed by the move, but still expressed confidence in rolling the bulk of the funds.

The Turkish central bank, in a remarkable display of independence, has raised its weekly repo rate by 625bp, combatting its runaway inflation but making recession a more likely prospect, according to one investor.

Investors’ eyes are on the Middle East this week as a slew of borrowers bring Sukuk trades to market, but while hopes are high for successful deals, a Turkish central bank rate decision looms large in investors’ minds.

Latvia has completed its 2018 funding programme with a €350m dual tranche deal, picking up the rest of the cash it was unable to raise in May.

China has made little headway in persuading the Russian government and Russian institutions into using the renminbi, as the fate of a sovereign bond in the currency remains uncertain and trading of RMB products stalls. But market participants are not giving up just yet, with a new trading platform set to launch next year, writes Paolo Danese.