Strong demand for Singapore dollar bonds has pushed issuances in March to hit S$3 billion, 20 per cent higher than the same month last year even as unease grows among bond investors wondering how long the debt rally will last.
The Markit iBoxx SGD corporate total return index is up 1.14 per cent year to date to 112.23 on Tuesday, off its all time high of 112.26 on March 17.
The S$3 billion was raised from 23 issues; in March 2014, there were 17 issues worth S$2.5 billion, according to Bloomberg data.
Year to date issuance though is still down compared to the same period last year.
For the first quarter 2015, there were 44 deals worth S$4.78 billion versus 41 issues and S$6.63 billion in Q1 2014.
On nervous investors, Clifford Lee, DBS Bank head of fixed income said "markets are still on tenterhooks", as seen from the lower volume of the first quarter.
There's a lot of market risks and pricing volatility, said Mr Lee.
"Deals are smaller.....S$50 million here, S$70 million there," he noted.
The SGD bond market is less of a trading market with investors the "take and hold" type, said Mr Lee.