Issuance has fallen despite a European Central Bank (ECB) decision to print 60 billion euros a month from March.

LONDON: Emerging market hard currency debt sales fell by a third in January from year-ago levels as nervousness over the rising dollar curtailed sales in what is usually a popular month for new issuance.

Countries and companies around the developing world often rush to issue debt in January, knowing investors will be keen to put new money to work in higher-yield assets. Last January, for instance they raised a record $66.3 billion in bonds.

Last month’s volume was $43 billion, the lowest January total since 2011, ThomsonReuters data shows. There were 45 deals versus 80 last January, the lowest number since 2010.

Emerging sovereigns sold just $13.7 billion in bonds, less than half last January levels, the data showed.

Issuance has fallen despite a European Central Bank (ECB) decision to print 60 billion euros a month from March. While the US Federal Reserve signaled its intent to raise interest rates in 2015, Treasury yields have tumbled to 18-month lows.

We are way behind in terms of deals. You had the ECB pushing in one direction but there were expectations of pressure on US Treasuries. That didn’t happen but a lot of investors were positioned for that, said Regis Chatellier, credit strategist at Societe Generale.

Potential default in Ukraine, a leftwing victory in the Greek elections and falling commodity prices also soured the mood, he said.

Chatellier calculates emerging sovereigns sold $16.5 billion worth of debt this month, down from $23.8 billion in Jan 2014.

Issuance figures often differ because of the way each compiler defines emerging markets.

My read is that investors are positioned a bit defensively, spreads have widened a lot in dollar terms, he said, referring to emerging yield premia which have widened more than 50 bps over US Treasuries since end-2014.

January sovereign issues included Tunisia’s first post-Arab Spring bond, not backed by the United States, a $1 billion deal from junk-rated Dominican Republic and others from Mexico, Philippines and Indonesia.

Corporate issuance is hit by Russian companies’ absence while Asian sentiment has been soured by fears of a default by Chinese homebuilder Kaisa.

Last January, some Russian and Kazakh entities were able to issue but they could not come now. Emerging currencies are weak. and in many places there are concerns about oil prices impacting local economies, said Andre Andrijanovs, a debt strategist at Exotix.

The first half of 2015 will be tough.