Nearly a month ago, Indonesia successfully placed two sovereign bond issues successfully for a sum totaling USD 3 billion. The news article is here. Earlier this week, a British gilt auction failed to receive 100% response. A German five-year bond auction narrowly missed the same fate. Here is a FT news report on these two matters.
The FT wrote thus on March 26th:
Yesterday was the fourth time a gilt auction has failed since they were introduced to raise public debt in May 1986.
Now, to further drive the point home, Indonesia’s bonds are trading well above par one month later. May 2014 paper with coupon of 10.375% is being quoted at 106-107.00. March 2019 11.625% paper is quoted at 109.5-110.50.
I guess it is time for people to start re-examining standard definitions of Emerging markets, sovereign risks