Economics
1MDB Bonds Soar After Mahathir Vows Full Probe of Embattled Fund
- 1MDB’s 2023 bond returned about 17 percent this week
- Relief rally seen on hope full investigation forthcoming
Mahathir Mohamad speaks during a news conference in Selangor, Malaysia, on May 17, 2018.
Photographer: Sanjit Das/BloombergThis article is for subscribers only.
Bonds sold by Malaysia’s scandal-scarred state fund 1MDB jumped about 17 percent this week, more than any other quasi-sovereign dollar bond in the developing world, amid an anti-corruption push by once and future leader Mahathir Mohamad.
1MDB bonds maturing in 2023, the globe’s worst-performing just one week ago, soared as investors bet Mahathir will follow through on vows to fully investigate the fund. The U.S. Department of Justice alleges that $3.5 billion has vanished from 1MDB, created under the watch of previous Prime Minister Najib Razak. The bonds are still down 2.5 percent this year.