More govt bonds won't crowd out corporates if RBNZ steps up

Wed, 13 May 2020

A flood of new government bonds to pay for the covid-19 rescue mission isn't expected to crowd out corporate issuers seeking to tap debt markets provided the Reserve Bank keeps buying the Crown's notes. But whether firms have the appetite to hit up the market is less clear given the massive economic uncertainty. An unprecedented government bond programme, coupled with the central bank’s plan to snap up 40 percent to 50 percent of those bonds, have already driven down long-term yields, with the 10-year government bond trading at a yield...

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