China Cities Face Surging Funding Costs on Default Concerns
- Hanrui sold 270-day bond at 6.8%, matching record-high yield
- Investors’ faith in implicit guarantee is weakening: Yaozhi
A Look at China's Looming Debt and Credit Problems
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China’s cities, towns and counties are facing surging borrowing costs as investors anticipate landmark defaults.
A local government financing vehicle in the country’s east was recently forced to pay a coupon on a bond that matched a record. Average financing costs in credit markets for the units that finance roads, bridges and sewers have jumped, with yields for some borrowers surging the most in six years.