Carry trade bonanza

Asian governments and quasi-government entities have issued record volumes of debt this year. This, combined with strong currency moves, is fuelling swaps activity in the markets. Can it last? William Rhode reports

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The last six months have seen a rash of activity in Asian sovereign and quasi-sovereign debt issuance, with Asian borrowers raising more than $45 billion through bonds denominated in G3 currencies as of October 19. That compares with just $16.8 billion last year, and already exceeds the previous all-time annual issuance high of $43 billion in 2005.

“These yearly figures are especially impressive,” says Patrick Tsang, director for debt capital markets at Deutsche Bank in Hong Kong. “For sovereign

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