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Global dollar credit and carry trades: a firm-level analysis

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  • Valentina Bruno
  • Hyun Song Shin

Abstract

We conduct a firm-level analysis of borrowing in US dollars by non-financial corporates from outside the United States. The dataset combines bond issuance data with firm-level financial information. We find that firms with already high cash holdings are more likely to issue US dollar-denominated bonds, and that the proceeds of the bond issue add to cash holdings. The tendency to add cash is more pronounced during periods when the dollar carry trade is more favourable and is prevalent for emerging market firms.

Suggested Citation

  • Valentina Bruno & Hyun Song Shin, 2015. "Global dollar credit and carry trades: a firm-level analysis," BIS Working Papers 510, Bank for International Settlements.
  • Handle: RePEc:bis:biswps:510
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    References listed on IDEAS

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    More about this item

    Keywords

    emerging markets; bond issuance; surrogate intermediaries;

    JEL classification:

    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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