The cost of insuring corporate and sovereign bonds in the Asia-Pacific region against non-payment rose, according to traders of credit-default swaps.
The Markit iTraxx Asia index of 40 investment-grade borrowers outside Japan jumped 7 basis points to 141 basis points as of 8:46 a.m. in Singapore, Westpac Banking Corp. (WBC) prices show. The gauge is set for its third straight day of increases, the longest stretch in more than a month, according to data provider CMA.
The Markit iTraxx Australia index climbed 3 basis points to 118 basis points as of 10:47 a.m. in Sydney, according to National Australia Bank Ltd. prices. The benchmark has traded between 113 and 139.8 this month, according to CMA, which is owned by McGraw-Hill Cos. and compiles prices quoted by dealers in the private market.
The Markit iTraxx Japan index rose 1.5 basis points to 95.5 basis points as of 9:19 a.m. in Tokyo, according to Citigroup Inc. prices. The measure is heading for its highest close since July 11, CMA data show.
Credit-default swap indexes are benchmarks for insuring bonds against default and traders use them to speculate on credit quality. A drop signals improving perceptions of creditworthiness, while an increase suggests the opposite.
The swap contracts pay the buyer face value in exchange for the underlying securities if a borrower fails to meet its debt agreements.
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