Taiwan 10-Year Yields Near Lowest in Two Weeks on Growth Concern

Taiwan’s government bonds were steady, with 10-year yields near the lowest in two weeks, as global funds cut holdings of the island’s stocks on signs a recovery in Asian exports is stalling.

Global funds sold $328 million more Taiwanese shares than they bought today, taking the net sales for the year to $9.9 billion, according to exchange data. Export orders rose 4.38 percent in October from a year ago after a 2.72 percent increase in the previous month, the government reported today. Singapore’s government today forecast 2012 economic growth may be as slow as 1 percent from as much as 5 percent this year.

“Yields have been falling due to concern global growth is weakening,” said James Wang, a fixed-income trader at Yuanta Securities Co. in Taipei. “The recent bond sale has shown insurers are still interested in Taiwan’s long bonds. I think yields have peaked.”

The yield on the 1.25 percent bonds due September 2021, the most-traded government debt, was at 1.322 percent from 1.321 percent last week, which was the lowest level for benchmark 10- year rates since Nov. 3, prices from Gretai Securities Market show.

The local dollar was at NT$30.260 against its U.S. counterpart, from NT$30.257 last week, according to Taipei Forex Inc. It touched NT$30.29 on Nov. 17, the weakest level since Oct. 24.

Stock indexes in Asia slipped for a fifth day amid concern U.S. lawmakers will fail to reach an agreement to cut the budget deficit.

The overnight money-market rate, which measures interbank funding availability, was little changed at 0.398 percent, according to a weighted average compiled by the Taiwan Interbank Money Center.

To contact the reporter on this story: Andrea Wong in Taipei at awong268@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

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