Dwindling prospects for more interest rate hikes by the Reserve Bank this year might stoke interest in corporate bonds as investors seek certainty of income. Economists have pared back expectations for central bank governor Alan Bollard’s tightening track after a string of soft data was compounded by the collapse of South Canterbury Finance Ltd and the Canterbury earthquake. Markets expect Dr Bollard to hike the Official Cash Rate 59 basis points over the next year. With markets firmly entrenched in a downbeat assessment of so-called risk assets, interest in corporate debt has reignited, with a flurry of small issuance in recent weeks, including Goodman Property Trust’s private placement, Greenstone Energy, TrustPower Ltd, and Manukau City Council, says Grant Hassell, head of fixed interest at AMP Capital Investors. He said corporate debt looked more attractive than government debt.  - Businesswire