FICC Focus Credit Crunch: Around the World of Global Credit in 60 Minutes
Dec 10, 2025
In this insightful discussion, guests dive deep into global credit dynamics. Jason Lee highlights the decline in China's dollar bond market and India's potential for strong performance in 2026. Tim Tan unpacks the intricacies of Panda and Dim Sum bonds amid currency risks in Asia. Basel Al-Waqayan forecasts significant growth in the GCC's dollar issuance, emphasizing its rising prominence in emerging markets. Reto Bachmann explores the European structured credit landscape, detailing trends in CLOs and covered bonds. A comprehensive look at the evolving credit market awaits!
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China Dollar Bond Shrinkage
- China's dollar bond market is shrinking due to de-dollarization and cheaper onshore yuan funding alternatives.
- Jason Lee expects gross dollar issuance from Chinese issuers to fall to around $100bn in 2026.
Yuan Markets Diversify Issuance
- Panda (onshore) issuance is being driven by sovereigns who set benchmarks for corporates to follow.
- Offshore dim sum will grow as investors seek yuan exposure and as Chinese issuers de-dollarize liabilities.
Hedge FX And Be Agile On Duration
- Manage currency risk actively because FX will drive local returns more than rates in Asia next year.
- Stay agile on duration: be ready to shift between short and long duration as Fed policy and QE signals evolve.