TD Securities

The International Finance Corporation is looking to enlarge its Brazilian reais issuance and boost its profile with Uridashi investors.

More issuers are expected to tap the New Zealand dollar market soon, following a Eurobond from ANZ on Monday. Syndicate bankers away from the deal predict that issuers will look to take advantage of growing investor interest in the high yielding currency.

More issuers are expected to tap the New Zealand dollar market soon, following a Eurobond from ANZ on Monday. Syndicate bankers away from the deal predict that issuers will look to take advantage of growing investor interest in the high yielding currency.

Toronto Dominion’s first legally compliant covered bond stormed the market on Monday morning, raising €1.75bn — €750m more than any of the other five Canadian euro covered bond benchmarks that have been launched this year, and the joint largest euro deal of the year.

A favourable basis swap and attractive opportunities at the far end of the curve are likely to spur European agencies to take to the far end of the curve in Australian dollars in the coming weeks. Opportunities also exist in the belly of the curve, however, with the Inter-American Development Bank benefiting from an attractive spread over local public sector paper for a long five year this week.

Yield starved investors are showing growing interest in picking up New Zealand dollar paper, looking to stock up on bonds denominated in the currency of the only developed economy enjoying rising interest rates. Rabobank and Commonwealth Bank of Australia both sold Eurobonds in the currency this week, drawing attention from institutional investors as well as the retail buyers that normally dominate the asset class.

The European Investment Bank, which is over 75% funded for the year, went strategic this week by dipping into South African rand with a curve extending eight year deal. Elsewhere, the International Finance Corporation and KfW picked up funding in Australian and New Zealand dollars.

The Inter-American Development Bank took advantage of strong demand for dollar paper this week to sell its largest dollar benchmark, while Bank Nederlandse Gemeenten also visited the market, suggesting that appetite remains robust despite many investors getting ready to embark on summer holidays.

Rating: Aaa/AAA/-

Supranationals and agencies are expected to look to non-core currencies — particularly Australian and New Zealand dollars — in the coming weeks as they hunt for attractive funding opportunities. Well-funded issuers may prove reluctant to sell large deals in benchmark currencies, and could instead follow the example of Bank Nederlandse Gemeenten which sold a pair of Australian dollar deals this week.

Searing domestic demand for supranational paper allowed the World Bank to sell the largest Kangaroo bond in four years on Tuesday. The deal was the issuer’s second non-core dollar blowout in as many weeks, following its execution of the largest ever Kauri deal on June 13.

European Investment Bank and Export Development Canada showed their Australian dollar appeal this week, selling hefty deals in the belly of the curve. Japanese demand propelled the EIB to success, allowing the issuer to sell its largest Kangaroo deal in three years.