Regional Fixed Income Market Watch, August 2024

In August 2024, global fixed income markets saw a moderate volatility in yields. Overall, in US and Europe yields remained roughly on the same level as a month before. During the past month, the US 2 and 10-year US treasury yields declined by 24bps and 7bps, respectively. Meanwhile, 2-year German bund yield lost a mere 8bps, while a 10-year German bund gained 4bps.

In regional sovereign bond markets Turkey, Georgia, Armenia, and Kazakhstan all saw decreases in yields. While Armenia and Kazakhstan experienced slight reductions, the change in yield was more profound in Georgia and Turkey. Meanwhile, a rather uniform dynamic was observed in in Georgian corporate Eurobond market, with only TBC 10.775 PERP seeing an increase in yield, while remaining bonds experienced a decline in yields.

Georgia money market 
In Aug-24, GEL 230.0mn treasury notes and GEL 40mn treasury bills were sold. Notably, interest rates decreased on all instruments m/m. The weighted average interest rate on 10-year notes was 9.152%, on 5-year notes was 8.773%, on 2-year notes was 9.082%, on 1-year instrument was 7.798%, and it came in at 7.825% for 6-month instruments. Notably, non-residents’ treasury holdings surged by 68.5% m/m to GEL 306.8mn, after falling by 11.5% m/m in Jul-24 and the share of non-residents in total outstanding holdings came in at 3.4% (+1.3ppts m/m) in Aug-24.