All Sovereign Bonds articles
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White papersQ2 2021 Investment View - Some like it hot
On the ground it does not feel like it just yet, as Europe battles with a third wave of infections, but markets are fast proceeding to the Covid crisis exit door. Too fast? We do not think so and see room for further rotation.
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White papers
Anticipating climate change risks on sovereign bonds
The profound economic mutations necessary to achieve the Paris Agreement objectives requires a consistent reallocation of resources. This gives the financial sector a key role in tackling climate change. Risk analysis is important in that perspective.
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White papers
FTSE Russell China Bond Research Report March 2021
Interest in China’s sovereign debt market surged in 2020 as international investors hedged against a global volatile market in equities and declining U.S.Treasury yields, with losses driven in part by the coronavirus crisis. Increasing foreign investment in Chinese government bonds rose in tandem with the rising volume of issuances by the Ministry of Finance throughout the year.
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White papers
Why we don’t expect the Fed to taper its bond buying programme this year
In a world where sovereign bond yields are in the hand of central banks, the recent upward revisions of growth expectations for the US economy raised questions about the outlook for the Fed’s monetary policy. Growth is expected to rebound in H2 and very accommodative monetary policy is not a free lunch. The difficulty for the Fed is estimating how sustainable this expected improvement in growth and inflation will be in H2 2021.
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White papers
China fixed income: under the microscope
China fixed income is a growing asset class, and our presentation at the 2021 Greater China Conference delved deeper into it with four sector experts and a lively Q&A session.
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White papers
How democracy is impacting economic policy and investment outcomes
Economic policy has an empirically documented relationship to asset prices. For example, sovereign bonds of economically “free” countries typically have higher credit ratings and much tighter yield spreads than those of countries where economic policy is much less liberal. It follows then that an investor who can correctly assess whether a country is becoming more/less economically free can – all else equal – potentially make money for their clients. Since markets appear to appropriately discount current economic policy conditions, the challenge for professional investors is to understand and accurately forecast the likely direction of policy change.
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White papers
Alternative UCITS: delivering on diversification
Europe’s Alternative UCITS funds have delivered on their diversification promise during the coronavirus-related market turbulence of 2020.According to Bernadette Busquere Arnal, European Head of Hedge Fund Research and Nathanael Benzaken, Chief Client Officer, the Alternative UCITS sector will continue to grow and Lyxor is positioning its fund platform to benefit clients in future.
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White papers
Blog | Charting the impact of sovereign bond market inclusion
The impact of inclusion of a country’s bonds in a flagship local currency government bond index, is naturally of great interest for issuers and investors alike. An accurate overview allows market participants to anticipate corresponding asset flows and allows issuing governments to more accurately assess the impact to their local capital market of an inclusion event.
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White papers
Africa Update: Debt Service And Liquidity Outlook Amid Covid Resiliency
Africa’s hard currency sovereign debt can be a source of notable alpha generation, with the region outperforming the J.P. Morgan EMBIGD benchmark in two of the last three years.1
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White papers
Bonds that are not really binding
Should the €2,800 billion in sovereign bonds or the equivalent* that are on the European Central Bank’s balance sheet be treated just like any other bonds? This question, which has come up regularly over the past several months, is far from being of mere academic interest.
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White papers
Blog | Annual index industry survey reveals 3.05 million total indexes and 40.2% growth in ESG space
For the fourth year running, the Index Industry Association (IIA), a trade organization for independent index providers, has quantified the global index universe, compiling data from its 16 member firms, including FTSE Russell.
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White papers
Blog | So hot right now: taking the temperature of sovereign bond portfolios
Climate-related risks have been front and center for equity investors for some time—there has been growing pressure to align investments to avoid loss or even optimize opportunities related to the impact of climate change. But now the same spotlight is on physical and transition risks in fixed income portfolios, including sovereign bonds.
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White papers
Investment View - The New Age of Financial Repression
Given the surge in government and corporate debt, policy will inevitably focus on making this load sustainable: financial repression, spearheaded by central banks, is set to reach a whole new level.
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White papers
Democracy’s dichotomous role in economic policy changes and investment outcomes
This research paper, picking up on the empirically documented relationship between economic policy and asset prices, seeks to identify key determinants of economic policy change.
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White papers
EMD: Further Room to Run?
Emerging markets debt rallied strongly in the second quarter—and while risks remain ever-present, the asset class may benefit from continued monetary stimulus and the potential for a sharper economic bounce-back in the second half of the year.
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Asset Manager News
Implications of the global debt explosion
Global debt was at an unprecedented level before Covid-19. With the subsequent policy response injecting liquidity into most parts of the world economy, the debt predicament is set for a worse path. We explore the implications for sovereigns, financials and corporates, particularly from the perspective of credit investors.
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White papers
Gold mid-year outlook 2020 - Recovery paths and impact on performance
Investors have embraced gold in 2020 as a key portfolio hedging strategy. Looking ahead, expectations for a faster recovery (V-shaped) from COVID-19 are shifting towards slower recovery (U-shaped), or potential setbacks from additional waves of infections (W-shaped).
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White papers
Green Bond Bulletin: social bond and sovereign green bond issuance surges
The corona crisis has triggered some ESG rebalancing in the sustainable fixed income space. Whereas in the past green bonds dominated, a heightened focus on the wide-ranging social implications of the pandemic has shifted the emphasis from E to S in the last couple of months. This change is reflected in the increase in social bond issuance – bonds that raise funds for social projects. In the long term, however, green bonds will still lead the way in building a sustainable economic recovery and supporting the transition to a net-zero emission and climate-resilient world.
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White papers
The Eurozone Faces a Deep Recession, Not a Debt Crisis
The eurozone economy will be hit by Europe’s sharpest recession since World War II in the first half of this year, but it will likely withstand its impact before bouncing back strongly in the second half. Asset purchases by the European Central Bank will help member countries to absorb the fiscal hit from coronavirus and provide strong support for sovereign bonds.
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White papers
Gold and central bank reserve management during the Covid-19 pandemic
Central bank reserves are typically constructed according to three guiding principles: safety, liquidity and return. The Covid-19 pandemic has reinforced the significance of these principles and, by extension, the importance of smart and sustainable reserve management.
