International investors have backed the Morrison government’s ability to repair a historic deficit and flatten the Covid-19 curve.

Or at least, that’s what the data suggests, considering that international investors account for nearly half of the demand behind a record $19.4 billion Australian bond offering.

Global money managers, sovereign wealth funds, and central banks snapped up 46.2% of this monster bond offering.

The massive offshore appetite was reflected in the $53.4 billion worth of offers received on the 20th of May for the Australian Office of Financial Management’s ten and a half year deal. This result doubles the previous record order size of $25.8 billion.

John Woods, CIO for Credit Suisse Asia Pacific, said the strong participation from offshore investors suggest the lucky country – as usual – will emerge from this in a reasonably rapid and credible way.

Australia went into the pandemic lockdown with substantially less debt than other advanced economies and has the ability to stimulate substantially more and still maintain reasonably credible debt metrics, due to our extremely attractive debt levels.

As the saying goes, the proof is always in the pudding. Here I was, reading in the news about our crazy high debt levels while in fact we are still very much the lucky country.