The Kangaroo supranational, sovereign and agency (SSA) market has started 2019 with a trickle rather than its usual flood and intermediaries say Australian dollar pricing has been uncompetitive compared with offshore markets. They report solid fundamental demand but say a supply uptick is unlikely until there is a shift in the basis swap and pricing expectations.
On 16 January, International Finance Corporation (IFC) (AAA/Aaa) launched a minimum A$50 million (US$34.6 million) increase to its June 2029 Kangaroo bond. Indicative price guidance for the forthcoming deal is 43 basis points area over semi-quarterly swap, equivalent to 44.75 basis points area over Australian Commonwealth government bond. Pricing is expected on the day of launch, according to joint lead managers Nomura and TD Securities.