Favourable basis not enough to maintain Kangaroo flood

Despite a five-year basis swap in historically wide territory issuance in the Kangaroo market has slowed to a near standstill, with the 2019 maturity issued by KfW Bankengruppe (KFW) (AAA/Aaa/AAA) on November 26 being the first primary activity in the Kangaroo space since November 17. And while the current basis is favourable for offshore issuers, intermediaries say there are several factors – including continued volatility in the basis itself – constraining further activity.