Emerging market dollar-pay debt spreads tightened this week. Risk appetite remained strong on good economic data and the absence of significant negative headlines, resulting in a rise in equities and commodities, as well as tightening of credit spreads. The US dollar-pay JP Morgan EMBI Global index returned 3.55 % (year-to-date through March 11th, 2010).

S&P raise the Long Term Foreign Currency rating of Indonesia by one notch from BB- to BB. The rating agency cited the improving government debt ratio and growing foreign currency reserves as contributing factors to the positive move. This move had been widely expected as the sovereign had been placed on Positive Outlook in October 2009.

In Israel, data released showed the current account surplus grew to an impressive 3.2% for 2009. The growth in exports was the main reason and the factor for the current economic recovery. The currency was stronger this week.