Singapore Bonds Decline to Become Second-Worst Debt Market
By Kenneth Foo – Jun 12, 2013
Singapore bonds fell for a fourth day, making their loss for the past three months the second-biggest in the world, as investors gird for the possibility that the U.S. Federal Reserve could slow bond purchases.
The price of Singapore’s 3.125 percent note due in September 2022 tumbled to S$107.30 as of 3:27 p.m. local time from S$108.24 yesterday, based on data compiled by Bloomberg and the Monetary Authority of Singapore. The yield rose 10 basis points, or 0.1 percentage point, to 2.24 percent, a level not seen since July 2011.
“The only reason for this is the speculation of Fed tapering,” said Michael Wan, an economist at Credit Suisse Group AG in Singapore. “There’s pretty much a sell-off across all countries and markets.”
The Bloomberg Singapore Sovereign Bond Index (BSIN) has declined 2.4 percent over three months. The only other sovereign index among 33 tracked by Bloomberg that fell more was Slovenia’s with a 4.3 percent decline. The Bloomberg U.S. Treasury Bond Index fell 0.2 percent.
Nasty, for sure. But it’s only a fraction of the move that occurred in May/June 2008.
Here are the exact daily settled prices of that particular bond security mentioned, the 10-yr benchmark NY07100X 3.125% due on 01 SEP 2022:
Still, not going to be pretty for bondholders who have to keep their books MTM. Tough.