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Foreign issuers tap Canadian bond market as demand for non-US assets grows
Yahoo Finance· 2025-09-29 10:02
Group 1 - Global companies, including Citigroup and McDonald's, are increasingly issuing bonds in Canada's market due to strong investor appetite and lower borrowing costs [1][2] - The issuance of "Maple bonds" by foreign borrowers in Canada reached $16.32 billion as of September 25, surpassing the total for all of 2024 and edging past the $16.28 billion raised in 2023 [2] - The trend is partly attributed to the Bank of Canada's more aggressive easing of policy compared to the U.S. Federal Reserve, which only resumed cutting interest rates recently [3] Group 2 - The inclusion of Maple bonds in the FTSE Russell Index in January has significantly driven investor demand [4] - U.S. companies are also seeking to borrow in euros, with bond sales reaching a record $100 billion this year [4] - Companies are responding to a growing demand for non-dollar assets amid uncertainties related to U.S. trade policies [5] Group 3 - Major bond issuers in Canada this year include Citi, New York Life, and Pacific Life [5] - The demand for U.S. corporate debt remains strong, with spreads on high-grade bonds nearing all-time tight levels [7] - The recent Fed rate cut is expected to further boost the U.S. corporate debt market [7]