Central Banks represented by US Federal Reserve and European Central Bank, have been turning their direction of policy from tightening to releasing. It is natural that global interest rate markets are showing bullish momentum. Yields of 10Year US T-Note and German Government Bund went to below 2.5% and 0% respectively.
According to Financial Times, the negative interest rates in Europe are attracting the issuers. Issuing the securities in euro by US companies has risen by more than 300% for this year compared with same period of last year. Considering sluggish regional economic condition which could makes Euro weak and interest rates of the zone more strong than that of the US, the trend will be proceeding for a while.
It is also being wonderful chance for the companies to lengthen maturities of their debts. They are buying back their old debts and re-issuing new debts with longer maturities.
The last point is movement of PEF. Private Equity Funds have $1.2tn idle liquidity and funding-cost is very cheap now. However, it does not mean immediate skyrocketing number of the deals. Many players believe there will be recession in a year or two and stock markets are too expensive. It makes them to hesitate to buy the companies.
There are no choice for the central banks now. The liquidity party will be continued.
According to Financial Times, the negative interest rates in Europe are attracting the issuers. Issuing the securities in euro by US companies has risen by more than 300% for this year compared with same period of last year. Considering sluggish regional economic condition which could makes Euro weak and interest rates of the zone more strong than that of the US, the trend will be proceeding for a while.
It is also being wonderful chance for the companies to lengthen maturities of their debts. They are buying back their old debts and re-issuing new debts with longer maturities.
The last point is movement of PEF. Private Equity Funds have $1.2tn idle liquidity and funding-cost is very cheap now. However, it does not mean immediate skyrocketing number of the deals. Many players believe there will be recession in a year or two and stock markets are too expensive. It makes them to hesitate to buy the companies.
There are no choice for the central banks now. The liquidity party will be continued.
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