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KfW Bankengruppe (KfW) (AAA/Aaa/AAA) launched and priced an increase to its May 2021 Kangaroo maturity on October 19. The A$250 million (A$257.6 million) tap adds to a line which was introduced in May this year and has been increased twice already, with the amount outstanding in the line after pricing on the increase being A$1.65 billion.

A prospectus for Woolworths' (A-/A3) offer of an indicative A$500 million (US$509 million) hybrid security was lodged with the Australian Securities Exchange on October 18. The transaction includes a specifically-targeted institutional offer, although fund managers contacted by KangaNews in advance of the official launch say they have yet to draw conclusions on their likely level of interest.

Asian Development Bank (ADB) (AAA/Aaa/AAA) priced a new NZ$150 million (US$118.8 million) five-year Kauri transaction on October 18. The new deal is ADB's second-ever Kauri transaction. It is the third Kauri issue within three weeks, with the most recent issue being the largest of the year: a NZ$350 million (US$281.1 million) tap from International Finance Corporation (AAA/Aaa).

The Australian Office of Financial Management (AOFM) released its 2010/11 annual report on October 14. The report suggests the overall market for Commonwealth government securities (CGS) issuance was positive over the year, highlighting a marginal reduction in effective yields for the financial year, increased secondary market turnover and increasingly-broad interest in Australian product from global investors.

The week ending October 14 saw the first Australian major bank transaction issued into the domestic market in more than two months. Elsewhere, sporadic securitisation flow continued with a new residential mortgage-backed securities issue.

Unexpectedly positive Australian employment numbers released on October 13 have caused some strategists to revise their expectations of an imminent Reserve Bank of Australia (RBA) rate cut, while more hawkish commentators say the jobs data supports their view. However, there are still economists who believe the employment figures should not be interpreted as an early sign of an upswing and still predict a November cut.

Standard & Poor's (S&P) and the Australian Securities Exchange (ASX) have launched a series of Australian bond indices, with the use of prices sourced from the multi-dealer platform, Yieldbroker, as a main selling point of the new product suite. S&P claims a wide range of market participants, including asset consultants, superannuation funds and funds managers, are supportive of the introduction.

ME Bank's second residential mortgage-backed securities (RMBS) issue of 2011 priced on October 12 at a size of A$665 million (US$661 million). The deal, SMHL Series Securitisation Fund 2011-2 (SMHL 2011-2) was upsized from a launch volume of A$500 million and adds to the A$1 billion ME Bank priced in another issue via its SMHL vehicle in March this year.

Lead managers on the most recent Kauri deal to come to market – International Finance Corporation (IFC)'s (AAA/Aaa) NZ$350 million (US$268.8 million) 2016 increase – continue to believe there are fundamental factors supporting further issuance. But they are also sanguine about the potential headwinds and say deal flow is likely to remain sporadic for the foreseeable future.