HALISTER1: Asia Emerging Mkts Buoyed by Fed’s Dovish Moves, DB Says

Asia Emerging Mkts Buoyed by Fed’s Dovish Moves, DB Says

(Bloomberg) -- “Sharp dovish change in FOMC forecasts has profound implication” for Asia emerging mkts, Deutsche Bank economist Taimur Baig wrote Fri.
  • FOMC participants have made “sobering revisions” to projections of potential GDP, natural rate of unemployment and terminal fed funds rate
  • Fed officials must be more cautious due to factors such as impact of USD on U.S. exports, mkt volatility, China’s slowdown, commodity bust, Brexit
  • For emerging fixed income and FX mkts, particularly in Asia, Fed caution “is bound to be a source of prolonged respite”
    • “May well be considerable room left” for bond prices in countries such as India and Indonesia to rise
  • Policy makers in Malaysia, South Korea, Taiwan and Thailand may be compelled to cut rates even further; latter 3 may even entertain zero bound
  • Lower terminal rate, more protracted Fed policy cycle means more room for capital in Asia, given “plethora” of high yield/rates mkts
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Taimur Baig (Deutsche Bank AG)

Topics
BGOV Finance

To de-activate this alert, click here

UUID: 7947283

HALISTER1: UST 2Y Sale May Be ‘Lackluster’ as Relatively Unattractive: TD

UST 2Y Sale May Be ‘Lackluster’ as Relatively Unattractive: TD

(Bloomberg) -- Treasury’s $26b 2Y auction Tues. should be “relatively lackluster” due to “relative unattractiveness” of 2Y on the curve and Yellen’s remarks due on Friday, TD strategist Gennadiy Goldberg said in note.
  • Past 2 auctions have seen “softer results” due to lower buy-side participation
  • Averages suggest 0.1bp stop, 62% buy-side award (46% indirects, 16% directs)
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Gennadiy Goldberg (TD Securities USA LLC)

To de-activate this alert, click here

UUID: 7947283

HALISTER1: CP/CD Maturities Set to ‘Ramp Up,’ Pushing Rates Higher: JPM

CP/CD Maturities Set to ‘Ramp Up,’ Pushing Rates Higher: JPM

(Bloomberg) -- Banks face “sizable maturities” from late-Aug. through early-Sept., which should pressure funding rates higher, JPMorgan strategists led by Alex Roever said in note.
  • Maturities “ramp up” again in early Oct., which may help lift rates again
    • NOTE: USD 3-mo. Libor set at 0.8254%, highest since May 2009; 1-mo. Libor 0.5222%, highest since March 2009
  • Japanese banks face heaviest period of maturities next 2-3 wks; French banks have a “glut” of maturities in Sept., which may become a pressure point; Canadian banks have “relatively large maturities” in early Oct.
  • Funding pressures are beginning to spread to the 1-mo. sector as banks, especially Japanese and French banks, are “willing to forgo” economics at the moment by continuing to issue in 1-mo. maturity bucket
    • Possible they may not be as “LCR constrained as other banks,” may hope to “temporarily ride this out” until Oct. 14
  • Banks issuing more 1-7-day maturities, which comprise ~80% of all volume traded
    • NOTE: Of total $12.681t of AA financial paper, $11.918t have 1-9 days until maturity, Federal Reserve data show
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Alex Roever (Bear Stearns & Co Inc)

To de-activate this alert, click here

UUID: 7947283

HALISTER1: Coast Capital Savings Credit Union - DBRS Rating Report

Coast Capital Savings Credit Union - DBRS Rating Report

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

Tickers
0932908D CN (Coast Capital Savings Credit Union)

People
Maria-Gabriella Khoury (DBRS Inc)

Topics
Fixed Income Research
Credit Analysis Research
Credit Research
Investment Research
Issuer Focused Research

To de-activate this alert, click here
To modify this alert, click here

UUID: 7947283

HALISTER1: Money Market Reforms May Create T-Bill Squeeze in 1Q: BofAML

Money Market Reforms May Create T-Bill Squeeze in 1Q: BofAML

(Bloomberg) -- T-bill market may face a “much larger” supply squeeze amid regulatory-driven increase in govt money market assets and Treasury’s need to shrink its operating cash balance before the debt ceiling is reinstated March 15, BofAML strategist Mark Cabana said in note.
  • May be $800b-$1t more in govt fund assets in relation to sharp Treasury cash balance reductions of 2015
  • Also, Treasury will have est. $390b cash balance at end-2016, though possible it’s going to need to “decline rapidly” before debt limit
  • Current legislation states Treasury can’t increase cash level above “normal operating balances” in anticipation of debt limit, which in the past has been interpreted as balance level when debt limit was extended
    • NOTE: Balance was ~$30b when debt limit became binding in March 2015 and recent debt ceiling resolution was passed in Oct. 2015
    • May cause Treasury to reduce balance by up to $360b during 1Q
  • Reduction in cash balance could result in “substantial richening across the bill curve”
  • Few scenarios may limit extent of bill paydown, though they are very unlikely
    • Treasury may not “aggressively” increase 4Q cash balance level in order to avoid large drawdown in 1Q 2017, which would risk a “more pronounced richening” of bills around money market deadline
    • Treasury could make argument to Congress that “normal operating” level of cash balance is closer to $150b minimum established in May 2015
    • Congress makes any potential passage of debt limit “relatively easy” and “unlikely to require the typical political posturing or accounting maneuvers”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Mark Cabana (Bank of America Corp)

To de-activate this alert, click here

UUID: 7947283

HALISTER1: U.S. Structured Finance Newsletter – August 22, 2016

U.S. Structured Finance Newsletter – August 22, 2016

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

People
Charles Weilamann (DBRS Inc)
Chris Donofrio (Dbrs Inc)
Chris O'Connell (DBRS Inc)
Christopher D'Onofrio (DBRS Inc)
Claire Mezzanotte (DBRS Inc)

Topics
Fixed Income Research
Industry & Sector Research
Credit Analysis Research
Credit Research
Investment Research

To de-activate this alert, click here
To modify this alert, click here

UUID: 7947283