Turkey slides on central bank’s inaction on rates; Bulgarian Energy prices; LatAm quiet

By Rebecca Melvin

New York, July 24 – Following a week or more of stability and relative strength, Turkey’s bonds sold off on Tuesday after the country’s central bank kept its interest rates unchanged instead of raising them as many expected to fend off inflation.

The bank’s decision to leave its target interest rate unchanged at 17.75% resurrected fears that President Recep Tayyip Erdogan is imposing undue influence on monetary policy.

The Turkey 11 7/8% notes 2030 notes were down 0.34, or 0.25%, to 137.12. They had dipped to 132ish on July 13, dropped from nearly 139 on July 9.

Turley’s intermediate to long end also dropped, and the Turkish lira fell against the U.S. dollar by about 4%.

In the primary market, which was largely quiet, Bulgarian Energy Holding EAD joined a very slim list of July issuers for the Central & Eastern Europe, Middle East and Africa region, pricing a €150 million tap of its 3˝% notes due 2025 on Tuesday at par.

The state-owned electricity utility priced the original €400 million of notes on June 21.

Elsewhere, Sunac China Holdings Ltd. said it plans to conduct an international offering of dollar-denominated senior fixed-rate notes, according to a company announcement.

The Tianjin, China-based residential and commercial property developer plans to use proceeds to refinance the group’s existing debt.

Joint bookrunners of the Regulation S deal are HSBC, Morgan Stanley, China Citic Bank International, China Industrial Securities International, CMB International, Guotai Junan International, ICBC International and Nomura.

Latin America’s primary market was radio silent, with the secondary mostly little changed.

Petroleo Brasileiro SA’s 8 7/8% notes due 2026 traded last around 112.5 which was within Monday’s range.

The Petrobras 7 3/8% notes due 2027 traded last on Tuesday at 103.375, compared to 103 last on Monday, which had been down more than a point.

© 2015 Prospect News.
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