Regional Fixed Income Market Overview

Global bond markets weakened in May, as investors increasingly treated the US–Iran conflict as an inflation shock rather than a pure geopolitical risk event. Major bond indices rolled over, while US Treasury and German Bund yields moved higher on oil-price risks, delayed rate-cut expectations, fiscal concerns and rising term premia.

Regional Eurobond markets in the TBCC universe remained under pressure, mainly from higher global rates and weaker duration sentiment. Sovereigns were led by Türkiye and Romania as key risk stories, while corporate markets stayed more constructive, with selective issuance from Kazakhstan, Uzbekistan and Türkiye showing that investor appetite remains open for stronger names despite the difficult macro backdrop.

Georgian Eurobonds stood out as relatively resilient: Georgia’s sovereign spread to the USD benchmark continued to tighten and remains historically low versus the broader EM backdrop.