Investors Are Queuing Up to Lend Money to Australia's Government

Australia is continuing to see rock-star level demand for its debt, with Friday’s sale of notes due 2021 seeing bids for almost six times the amount on sale.

With yields staying down, appetite remains strong for bonds like these that are part of the three-year futures basket. The average bid-to-cover ratio for such notes this year is 5.15, greater than for any full year since 2004 -- when there were only two such offerings.

Demand really kicked off in July for Australian sovereign securities, when a single buyer snapped up all A$800 million ($632 million) of the 2029 notes offered at an auction, the largest ever amount bought by one bidder in sales dating back to 1982.

The next opportunity for investors to sate their Aussie hunger will be in the coming week, with a syndicated auction of new 2027 inflation-linked debt planned.

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