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China’s Spreading Property Debt Crisis Pressures Xi to Ease

  • Bonds of nation’s largest developer sank to lowest on record
  • Citigroup sees ‘urgency’ for Beijing to stabilize sector
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WATCH: Mounting concerns about hidden debt is sending Chinese developer bonds plummeting. Bloomberg’s Rebecca Choong Wilkins reports.Source: Bloomberg
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Financial contagion is roaring back in China’s property industry, putting renewed pressure on Xi Jinping’s government to do more to insulate the nation’s stronger developers.

Monday was the worst day on record for dollar bonds of Country Garden Holdings Co., China’s largest developer by sales. Some of its notes fell to as low as 62 cents, while its shares sank to an almost five-year low. The selloff also spread to stronger issuers like Longfor Group Holdings Ltd. and China Vanke Co. for the first time, as well as China’s bad-debt managers amid concern over their exposure to the property market, traders said.