Morning Commentary: CEE/MEA region eyes two planned deals so far this week; EM spreads stable

By Rebecca Melvin

New York, Oct. 23 – Central & Eastern Europe, Middle East and Africa region market players early Monday were eyeing two deals on the calendar, including Abu Dhabi Crude Oil Pipeline LLC’s $3 billion of notes and Arab Petroleum Investments Corp.’s planned five-year dollar Sukuk.

Both deals are on roadshows, with the earliest pricing of the Abu Dhabi notes seen Tuesday or Wednesday or even next week, a London-based source said.

Otherwise, spreads remained broadly steady, and the market was feeling fairly strong.

Central bank policy developments were also in view, including U.S. president Donald Trump’s pick to be the new chair and vice chair of the Federal Reserve. That decision could be announced this week, but more likely next week.

In addition, the next meeting of the European Central Bank is scheduled for Thursday, in which the bank may decide to reduce QE bond buying, but also lengthen the program by six to nine months, and with many expecting that it will commit to lower rates for longer.

“Trump coming up with proposed chair and vice chair is the bigger driver for dollar rates and therefore is the bigger factor for EM,” the source said.

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