June 2016

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The market’s global quest for safe haven assets spilled into the semi-government market in June and yields followed their Commonwealth counterparts down, producing a 1.038% rise in the Bloomberg Semi-Government Bond index. Spreads were typically wider by the end of the month, completely neutralising the contraction we saw in May but then a certain amount of lag is perhaps to be expected when underlying benchmark yields move as much as they did in June.

semis-june16

New issuance was negligible in June. NSW and Victoria are running budgets surpluses and WATC was the only issuer in this space, raising $700 million towards the $8 billion WA requires this financial year by way of an issue of October 2027s. October 2027 is not that much more than ten years from now but there currently appears to be a trend among semi-government issuers to issue longer-dated bonds.

AUST SEMI GOVT BONDS

ISSUERMATURITYCOUPON
(%)
ISSUE SIZEMONTH
HIGH
MONTH
LOW
CLOSING
YIELD
Δ MONTHΔ 2 MONTH
TCV15 Nov 165.7532661.861.791.80-0.01-0.29
NTTC20 Nov 165.755001.991.861.94-0.01-0.27
NSWTC20 Feb 174.0036301.831.681.72-0.11-0.22
NSWTC01 Mar 175.506871.771.621.66-0.11-0.23
WATC15 Jul 178.0054591.891.731.77-0.11-0.28
QTC14 Sep 176.0010361.741.621.67-0.05-0.22
SAFA20 Sep 175.7524031.851.711.75-0.09-0.26
TASCORP20 Sep 175.009801.881.741.79-0.08-0.25
QTC21 Sep 173.5048261.821.711.74-0.08-0.26
NTTC17 Nov 174.755001.901.751.80-0.10-0.27
TCV17 Nov 173.5028251.811.701.74-0.05-0.24
NSWTC01 Feb 186.0046701.811.651.68-0.08-0.27
QTC21 Feb 186.0055621.851.691.73-0.10-0.29
ACTTREAS07 Jun 185.505501.931.761.80-0.09-0.25
NTTC20 Sep 184.755002.021.841.87-0.10-0.28
WATC23 Oct 183.7551251.991.821.86-0.07-0.26
TCV15 Nov 185.5040231.871.691.73-0.07-0.29
NSWTC20 Mar 193.5046831.861.671.71-0.08-0.28
NSWTC01 Apr 196.005381.781.591.63-0.08-0.28
QTC14 Jun 196.2530401.841.671.70-0.06-0.30
QTC21 Jun 194.0057831.971.801.83-0.06-0.30
SAFA06 Aug 194.7520001.971.801.85-0.06-0.28
WATC15 Oct 197.0041732.061.881.93-0.05-0.26
QTC21 Feb 206.2596862.031.841.88-0.09-0.35
NSWTC01 May 206.0062081.901.721.75-0.10-0.33
ACTTREAS22 May 204.255702.031.831.88-0.11-0.34
NSWTC01 Jun 206.001011.811.611.66-0.10-0.33
TASCORP15 Jun 206.006542.071.871.92-0.12-0.34
TCV15 Jun 206.0061581.921.731.77-0.11-0.35
NSWTC08 Apr 214.0034562.001.811.81-0.16-0.40
SAFA20 May 215.0020442.171.982.01-0.12-0.37
QTC14 Jun 216.0014482.001.821.82-0.14-0.41
QTC21 Jun 215.5070732.151.961.97-0.14-0.42
WATC15 Jul 217.0034112.252.062.09-0.10-0.36
NTTC20 Sep 214.256502.262.042.07-0.16-0.39
NSWTC01 Mar 226.0058042.091.881.88-0.21-0.44
TASCORP08 Mar 224.257132.292.082.09-0.20-0.44
ACTTREAS11 Apr 224.255502.252.022.03-0.21-0.44
QTC21 Jul 226.0082082.302.102.10-0.17-0.43
TCV17 Oct 226.0061352.151.941.94-0.20-0.44
NSWTC20 Apr 234.0042232.242.002.00-0.24-0.48
NSWTC01 May 236.0010182.121.881.88-0.23-0.47
QTC21 Jul 234.2578932.452.232.23-0.20-0.48
WATC16 Oct 236.0037072.582.362.37-0.16-0.42
SAFA20 Nov 234.2515202.482.272.28-0.18-0.44
NTTC15 Mar 246.006502.572.322.32-0.25-0.49
TASCORP11 Jun 244.006672.542.312.31-0.25-0.49
QTC22 Jul 245.7579662.552.312.31-0.22-0.49
NSWTC20 Aug 245.0063232.342.092.09-0.25-0.47
TCV17 Dec 245.5049642.372.122.12-0.24-0.48
SAFA16 Apr 252.7512502.682.452.45-0.23-0.47
QTC21 Jul 254.7559342.652.402.40-0.26-0.51
WATC23 Jul 255.0030592.782.542.54-0.22-0.46
TASCORP19 Feb 263.255252.762.502.50-0.27-0.49
NTTC15 Mar 266.006502.722.452.46-0.27-0.50
QTC21 Jul 263.2536002.782.492.49-0.30-0.52
TCV17 Nov 265.5038182.492.242.24-0.26-0.49
WATC21 Oct 273.008132.990.002.772.772.77
QTC21 Jul 283.2510002.910.002.662.662.66
NSWTC01 May 306.003602.782.452.45-0.34-0.53
TCV20 Dec 324.253252.982.682.68-0.31-0.51
QTC14 Mar 336.5012103.152.892.91-0.26-0.49
Issues underlined are guaranteed by the Commonwealth Government