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Tight spreads and de-dollarisation shape Asia’s credit outlook

Heather Ng
Investors are pivoting to local-currency convertibles and China's refreshed regulatory channels to secure resilience and yield.
Tight spreads and de-dollarisation shape Asia’s credit outlook
Key Points
  • Convertible bonds are seeing rising attractiveness in CNY, TWD and JPY as regional currencies offer diversification and FX returns alongside sector plays.
  • Recent refinancing rule updates in China have reopened issuance channels for high-quality tech companies, stabilising the convertible supply side.
  • Market democratisation via ETF structures has created a stable long-term institutional demand floor to buffer convertibles against volatility.

Asian credit markets are entering a delicate phase where tight spreads, shifting currency dynamics and regulatory changes are changing how investors balance risk and opportunity.

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