China Yield Curve Flattens as PBOC Seen Resisting Rate Cuts
- Yield gap between 1-year, 20-year bonds is smallest since 2015
- Economic growth concern boosting longer-dated maturities
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In China’s bond market, the longer the better.
The difference between yields on China’s one- and 20-year government bonds, a measure known as the yield curve, has narrowed to the least since April 2015. Declines in shorter-term yields are being capped by expectations the central bank will hold off from cutting borrowing costs, while concerns the economic outlook will worsen is boosting longer-dated maturities.