Skip to content
Subscriber Only

China Is Cracking Down on Inflated Bond Trading Numbers

  • Volume on policy bank note tanks after surging to record high
  • Clampdown targets large transactions on X-bond system: traders
Updated on

China is cracking down on banks and brokers that it suspects of inflating bond trading volumes in an effort to win more business, according to traders familiar with the matter.

A subsidiary of the central bank is monitoring large transactions on the X-Bond system for signs of abnormal trading, the two traders said, asking not to be named as they’re not authorized to speak to media. The checks started after turnover on a China Development Bank note spiked to a record on July 16, according to the people. Daily volume on that contract has fallen by a third since.