EM ASIA DEBT-Spreads widen on U.S. GDP; new PSALM bonds ease

HONG KONG, Nov 25 - Asian debt spreads widened on Wednesday, as weaker-than-forecast U.S. GDP prompted investors to take profit, dragging down recently issued bonds from a Philippine state agency.

The Asia ex-Japan iTraxx investment-grade index <0#ITAIGMPBMK=> was 6 basis points wider at 110/113, traders said.

The U.S. economy expanded at a 2.8 percent annualised rate in the third quarter, less than the previous 3.5 percent estimate. It was also below expectations for a growth rate of 2.9 percent. [ID:nN24296971]

"The market is just drifting, with very thin activity on the Itraxx and individual name CDS," a Hong Kong-based trader said. "Fund managers, dealers and almost everybody are keeping their positions square because of the year-end environment. There is no pressing need to have a long or short position."

Bonds sold on Monday by Philippine agency PSALM due in 2024 were quoted at 101.75/102.125 cents on the dollar, slightly lower than Tuesday's 101.875/102.125, a trader said.

The agency oversees the assets and debts of state power producer Napocor.

The Philippines' 5-year credit default swap <PHGV5YUSAC=R> widened 3 bps to around 180.

The Philippines, one of Asia's frequent debt issuers, is not expected to tap the market until the first quarter of 2010. Traders said PSALM's bond sale was probably the last from the country this year.

Indonesia's 11.625 percent debt due in 2019 <718286BG1=> was quoted steady at 141.50/142.50 cents on the dollar, traders said.

LATEST MAJOR RATING ACTIVITY IN ASIA > Fitch: Vietnam FX move no rtg impact for now.... [ID:nT354852]

For history on TRX Emerging Asia Index click on -- http://credit-content.session.rservices.com/reddatabase/TopRed.a sp FIVE-YEAR CREDIT DEFAULT SWAPS

Bid/Ask spread

Current Week ago

Korea Dev Bank 98.26* 99.16*

Hutchison 79.00* 74/78

PCCW-HKT 104.00* 99.33*

China 79.07* 73/78

Indonesia 198.59* 186/196

Korea 93.37* 90/95

Malaysia 97.07* 90/95

Philippines 178.59* 168/176

~no bid or ask

*midspread

For CDS prices double click on <REUTERSCDS>

For more bond prices click on <ASIASPREADS><ASIASPREADT>

((jun.ebias@thomsonreuters.com; +852 2843 6537; Reuters Messaging: jun.ebias.reuters.com@reuters.net; ))

(If you have a query or comment on this story, send an email to newsfeedback.asia@thomsonreuters.com)