China's $3.4 Trillion Corporate Bond Market Faces Rocky 2018
- Yields on AAA rated notes have jumped as deleveraging kicks in
- Weaker companies to find it harder to refinance debt: Gui
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China’s deleveraging campaign is finally starting to bite in the nation’s corporate-bond market, a shift that will make 2018 a clearer test of policy makers’ appetites to let struggling companies fail.
Yields on five-year top-rated local corporate notes have jumped about 33 basis points since the month began, to a three-year high of 5.3 percent, according to data compiled by clearing house ChinaBond. Government bonds, which have far greater liquidity, had already moved last month as the central bank warned further deleveraging was needed.