Singaporean corporate and South Korean sovereign bonds stand out as worthy investments, according to Sean Chang, head of Asian debt for Barings Bank.

The current strong performance of the region's debt markets will continue in the mid to long-term, said Chang, with the ongoing “accommodative” monetary policy of developed/developing countries and the appreciation of the renminbi against the dollar, driving local currency appreciation, the principal reasons for this.

The report also pointed to the regions “robust fundamentals” and improving corporate balance sheets as further indication of the asset class’s potentially strong future.
 
The perception of South Korea as a “safe haven”, Chang said, should lead to the appreciation bias of the Korean won against the US dollar strengthening. The recent sovereign bond rating upgrades for the country, Fitch to AA- and Moody’s from A1 to Aa3, highlighting the countries continued economic resilience amidst the largely volatile global environment.
 
Baring's preference for Singaporean Corporate bonds, especially long-dated issues, reflects current sentiment in the market, with deals such as ABN Amro’s recent Tier 2 S$1 billion hybrid bond launch accruing a S$17 billion order book very rapidly.