RSS China's bond market is screaming the “D” word. “D” as in depression.

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 RSS China's bond market is screaming the “D” word. “D” as in depression.

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A Wall Street Journal opinion piece. Which seems to be well-founded.


The Journal is gated, but in very brief from the article:

  • China's bond market reflects deep economic stress, with 10-year sovereign yields falling to 1.7% and 30-year yields below 2%.
  • businesses are struggling, unemployment is severe, and local governments are overwhelmed by debt
  • Efforts by Beijing to boost growth, including incremental stimulus measures and infrastructure investments, have failed to restore confidence, with bond markets signaling skepticism.
  • State-owned institutions are prioritizing bond purchases over investing in the broader economy, underscoring weak demand and limited policy effectiveness.

I posted a yield chart earlier, here it is again (China on top, US below):

This article was written by Eamonn Sheridan at www.forexlive.com.
 
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