Cash-Rich Funds to Help Drive Asian Bonds Higher, Aberdeen Says

Cash-rich fund managers keen to recoup losses after Europe’s sovereign debt crisis will drive Asian corporate bond prices higher during the traditional August lull, even as borrowers rush to exploit demand, said Aberdeen Asset Management Asia Ltd.

“Everyone’s buying so risk appetite is very strong,” Scott Bennett, Aberdeen’s regional head of credit, said during an interview in Singapore yesterday. “Funds are running high levels of cash and many money managers could be underperforming their benchmarks. With only five months left of 2010 to achieve the returns they want, there’s now a sense of urgency to get invested.”