TD Securities

The sterling SSA primary bond market is set to have a record breaking first quarter in terms of issuance volumes, which currently stand at £12.25bn. There have been a number of notable deals from inaugural issuers and those returning to the market after a long break, but also regular issuers have achieved much bigger volumes. From the demand side, the breadth of participation has also been apparent, with the three big investor bases — central banks, bank treasuries and UK real money — all participating in good size. We look into the reasons why and whether it will continue.

With the dollar market taking an early Easter holiday, the World Bank came through as the sole issuer to print in the currency, hitting $3bn in an arbitrage trade that was heralded as a “strong signal” of the health of the dollar market.

The World Bank surpassed expectations by raising $3bn of four year cash on Wednesday, in what one banker away from the deal said was a "strong signal" for the dollar market.

Investors continued to pour money into the US corporate bond market this week as March's rally in high grade bonds turned the market positive for the year.

A trio of issuers in euros joined the sole dollar SSA benchmark deal this week in a flurry of pre-holiday activity, with a banker away from the this week's action remarking that the terrorist attacks in Belgium were likely to have a limited effect on SSA deals.

World Bank is looking to grab an arbitrage opportunity with a four year global bond amid a dollar market that already appears to be on its Easter holidays.

The World Bank last Friday printed in Canadian dollars for the first time in a year, seizing on strong sentiment following the European Central Bank's latest bout of monetary easing.

Bank Nederlandse Gemeenten brought a 10 year dollar benchmark this week that sparked much debate about whether other issuers would be able to follow in the tenor. Although with a flurry of other trades this week, it is clear that other options are available once next week’s US Federal Reserve meeting is held.

Council of Europe Development Bank and World Bank on Wednesday added to a strong week from public sector borrowers in the dollar market ahead of a vitally important US Federal Reserve meeting.

Berlin Hyp issued the first negative yielding covered bond this week, giving investors a sign of things to come as financial institutions prepare for another round of monetary policy stimulus from the European Central Bank.

There was a double breakthrough in dollars for public sector borrowers on Tuesday, as Bank Nederlandse Gemeenten reopened the 10 year part of the curve for core issuers for the first time in seven months and Sweden priced the tightest three year benchmark since the first week of the year.

Five year bonds continue to dominate the public sector dollar market, with the World Bank and European Investment Bank securing oversubscribed books at what is proving to be the sweet spot for the currency.