Asia-Pacific Bond Risk Unchanged, Credit-Default Swaps ShowBenjamin Purvis
The cost of insuring corporate and sovereign bonds in the Asia-Pacific region against non-payment was unchanged, according to traders of credit-default swaps.
The Markit iTraxx Asia index of 40 investment-grade borrowers outside Japan was unchanged at 111 basis points as of 8:10 a.m. in Hong Kong, Royal Bank of Scotland Group Plc prices show. The gauge closed at its lowest level yesterday since Jan. 29, according to data provider CMA.
The Markit iTraxx Australia index was at 113 basis points as of 11:09 a.m. in Sydney, according to National Australia Bank Ltd. prices. The benchmark closed at 113 yesterday, the lowest since Jan. 10, 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 was unchanged at 122 basis points as of 9:23 a.m. in Tokyo, according to Citigroup Inc. prices.
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.