China's Top Bond Fund Says Rout May Worsen
- China top bond fund says credit spread may widen next year
- E Fund’s Zhang says convertibles to outperform corporate bonds
Photographer: Qilai Shen/Bloomberg
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It’s been the worst month for China’s local corporate notes in two years. And it might just be the start, as the nation’s top bond fund manager says yield premiums could rise further in 2018.
President Xi Jinping is stepping up efforts to trim the world’s largest corporate debt burden, after emerging even more powerful from the Communist Party’s twice-a-decade congress in October. Financial institutions are hoarding cash amid expectations the government will announce more measures to curb leverage, and that is pushing up borrowing costs in the money market.