China Ramps Up Fight Against Record Bond Rally as Targets Widen
- Big banks seen selling 7-year notes to pull up yields: traders
- Local authorities suspended some lenders from trading bonds
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China widened its battleground against bond speculators, targeting everything from fund companies to rural banks to one of traders’ favorite parts of the debt market.
Within a span of 24 hours, China’s state-banks unexpectedly began selling seven-year bonds to pull up yields, undermining a popular sweet spot in the market. Local authorities asked some rural lenders in one of the most affluent provinces to suspend trading in sovereign notes. And regulators were reported to have slowed the approval for new bond funds.