Foreign borrowers set records across Asia-Pacific bond markets

Foreign issuers are pouring into once-niche Asia-Pacific bond markets at an unprecedented pace, pushing kangaroo, panda, and dim sum bond sales to all-time highs in 2026 as rising global borrowing needs force companies and governments to look beyond traditional dollar and euro markets.

Record Issuance Across the Region

Kangaroo bond sales — Australian dollar-denominated securities issued by foreign borrowers — reached a record A$60 billion (about $42 billion) through late July, up roughly 40% from 2025, according to LSEG data cited by Reuters. Hong Kong dollar issuance also hit record levels.reuters

Chinese onshore panda bonds and offshore dim sum bonds surged even faster. Panda bond sales reached about 160 billion yuan ($24 billion) and dim sum sales hit 350 billion yuan in the first half of the year, both climbing more than 60% year-over-year, according to Goldman Sachs. International borrowers accounted for roughly half of that volume.businesstimes+1

Germany's Commerzbank, French utility Engie ↗ 0.54%, Henkel, Singapore Airlines, and the Portuguese government all sold bonds in Australian dollars or yuan for the first time this year.reuters

"We've reached a tipping point where these markets have tipped over into being significantly more meaningful both to local names and inevitably to international names," said Carla Goudge, head of debt syndicate for Asia-Pacific at HSBC ↗ 0.56%.reuters

AI Spending and Global Deficits Drive Diversification

The rush into Asian markets reflects broader pressures. Global international syndicated bond sales reached a record above $4 trillion by late July, up from around $3.5 trillion in the same period last year, according to LSEG. The artificial intelligence investment boom and elevated government deficits are intensifying competition for capital in major bond markets.reuters

Even yen bond sales by foreign borrowers doubled this year. Alphabet's ↗ 0.18% record yen bond sale was a major driver, though issuance stands at a seven-year high even without it.businesstimes+1

Bankers have been advising clients to diversify funding sources early as hyperscalers crowd into the traditional markets they rely on. "For most issuers that are issuing away from their core currencies, it's often a function of larger funding programmes," said Hampus Falth, Mizuho's ↘ 1.07% head of debt capital markets syndicate for EMEA.reuters

Governments Line Up for Debut Issues

The trend extends to sovereign borrowers. Portugal became the first eurozone government to sell a dim sum bond in April, raising almost 2 billion yuan ($300 million) and swapping the proceeds back to euros at a modest saving. Brazil plans to sell its first-ever panda bond later this year, and Kenya is also considering the market.reuters

Christopher Kent, assistant governor at Australia's central bank, told a Reuters NEXT event on August 13 that momentum is self-reinforcing: "More investors come here to pick up these bonds and more issuers think that this is a good place to issue, for various reasons, and so you get a bit of growth and the growth then begets more growth".businesstimes