SUSTAINABLE BOND ISSUANCE TO BE FLAT IN 2022 AMID MARKET HEADWINDS -- MOODY’S

KUALA LUMPUR, May 26 (Bernama) -- International business and financial services company Moody’s has anticipated global issuance of green, social, sustainability and sustainability-linked (GSSS) bond volumes to be flat at around US$1 trillion (US$1= RM4.392) in 2022 amid the ongoing Russia-Ukraine war.

It said with the duration of Russia’s invasion of Ukraine unknown at this time, the military conflict has impaired global economic growth prospects, stoked existing inflationary pressures and heightened the prospects for accelerated monetary policy tightening.

“Our baseline expectation is that sustainable bond issuance growth will resume when market volatility abates and broader market conditions will provide greater than anticipated headwinds for sustainable bond issuance this year.

“Against this backdrop, our original 2022 forecast of US$1.35 trillion sustainable bond issuance appears out of reach,” it said in its May 2022 Environmental, Social, and Governance (ESG) Insights released today.

According to the monthly newsletter, Moody’s revealed that sustainable bond volumes moderated in the first quarter of 2022 (Q1 2022) as global market headwinds intensified.

“GSSS bonds totalled US$203 billion in Q1 2022, down 11 per cent from Q4 2021 and down 28 per cent from Q1 2021,” it said.

It added that the US$203 billion first quarter GSSS issuance is 22 per cent below the average quarterly issuance of US$260 billion achieved in 2021.

Moody’s said GSSS bond volumes also fell for the fourth straight quarter in Q1 2022 with the lowest quarterly issuance since Q3 2020.

-- BERNAMA