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Quasi-independent debt management offices are bringing new sophistication to government debt management. But de-risking government balance sheets that have so far failed to account properly for contingent liabilities may be beyond them. Peter Lee reports.

US inflation fears spooked nervous markets this May, causing the biggest one-day falls in years. In the space of a week, the Nasdaq Composite Index and the FTSE 100 gave up their entire gains for the year. Both indices shed about 7%. Markets took fright at the larger-than-expected 0.6% rise in April’s US consumer prices, which also spilled over into commodities markets. Although many think the sell-off has been exaggerated, May’s Merrill Lynch’s Global Fund Manager Survey shows growing pessimism about inflation and corporate profits. The survey shows a sharp increase in the percentage of fund managers who expect a rise in core inflation, to 64% from 47% a month earlier. A net 9% of fund managers also expect corporate profits to deteriorate while a net 27% except operating margins to deteriorate. Nevertheless, half the sectors in the S&P500 have been posting double-digit earnings growth. Despite the uninspiring outlook for equities, bonds are still looking overvalued to a net 48% of respondents while equities by contrast are still looking underpriced to a net 3% of investors.

Having emerged from a reshuffle in in the Hypo Real Estate Group at the start of the year, Hypo Real Estate Bank International is the most significant institutional response to the Pfandbrief Act yet. The merger of two banks with distinct business models and funding tools has created a real estate financier well equipped to match its hunger for growth, writes Florian Neuhof.

Time is running out for Eurotunnel as it tries to refinance its debt.

“Financial institutions should put customers’ needs first”, according to a report published by PriceWaterhouseCoopers on May 24. But should their services extend to matchmaking for young journalists? One of Euromoney’s débutant hacks was secretly pleased on a recent trip back from Moscow when his host bank’s head of IR forgot her passport: the subsequent delay meant a missed flight back to London, and a chance to watch the Champions’ League final in Vienna with the bank’s PR man and a gentleman from the Austrian media.

Barely a month seems to pass without either the launch of a new foreign exchange trading platform or at the least a significant enhancement and upgrade to an existing one.

Buy-to-let mortgage originators in the UK market have often argued that these assets should be seen as prime assets rather than non-conforming.

The Mexican bank has been an impressive innovator in project finance.

British Land’s decision to convert to a Reit might prompt the restructuring of its Meadowhall securitization.

The sophisticated pooling of cédulas hipotecarias satisfies the demands of issuers and investors alike.

Greek real estate moves into catch-up mode