China Is Speeding Up Infrastructure Bond Sales to Boost Spending
- Local governments speed up issuance of special bonds
- That’s causing liquidity squeeze that may prompt RRR cut
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China’s local governments are accelerating the pace of borrowing for infrastructure investment, a move that could help lift economic growth while also putting pressure on financial markets.
Provincial governments sold the most amount of special bonds in more than a year this month, according to Bloomberg calculations. And with Beijing setting a September deadline for the regions to issue their remaining allocation for the year, analysts are expecting a boost to debt supply next month.