Moody's: Foreigners' inflow to T-bonds lowers Poland's funding costs.

By bne IntelliNews August 10, 2012
The increased appetite of non-resident investors for Polish government securities has pushed yields lower, reducing the sovereign's cost of funding, which is a "credit positive," according to Moody's Investors Service. Last week, the finance ministry said that inflows of foreign capital into government securities increased by PLN 6.6bn (or 0.4% of GDP, according to Moody's) in June, raising foreign investors' total holdings of debt issued locally to a record level of PLN 174.3bn (10.9% of GDP) or 33% of marketable domestic debt. The ministry stressed that foreign investors' involvement is record-high now. The rating agency notes, at the same time, that this surge in capital inflows is to be seen against the backdrop of an economy that is poised to expand by 2.3% in 2012, one of the fastest rates among European Union members, "and is spurring interest among foreign investors that are taking note of the country's positive growth dynamics."

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