Economics
Emerging-Market Wobbles to Test Whether Asia Really Is Safer
- Junk dollar bonds, domestic debt among risks in emerging Asia
- Thailand, South Korea, China and Hong Kong on debt-worry list
This article is for subscribers only.
While Asia proved to be relatively stable through the Turkey-led emerging market sell-off this month, the region has its own vulnerabilities with the junk-bond market shaping up as a key area to watch.
The amount of such debt coming due in dollars from Asian issuers, excluding financial firms, will rise over the next three years to a record $24.2 billion in 2021. With global investors eyeing higher U.S. interest rates as the Federal Reserve raises borrowing costs, Asia’s riskier companies will face pressure to offer juicier yields to lock in fresh funding.