China’s sovereign bonds soar as shaky economic growth outlook dampens risk appetite
- Yields are at their lowest in at least two decades as a sluggish stock market and a long-running property downturn make ‘ultra-safe’ investment more attractive
The yield on 10-year sovereign bonds slipped to 2.21 per cent on Thursday, a level not seen since at least as far back as 2002, bringing the drop this year to 35 basis points, according to Bloomberg data. Yields on 20-year and 30-year Chinese government bonds are down 41 and 36 basis points this year respectively, hovering around record lows.
“It shows the market still expects growth to be muted going forward,” Dong Chen, chief Asia strategist and head of Asia research at Pictet Wealth Management in Hong Kong, said in a media briefing on Thursday.
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Japanese monetary authorities mull intervention options after yen drops to 34-year low
Domestic investors have grown more wary about the country’s growth outlook in recent months, Goldman Sachs said in a note last week, citing recent meetings with onshore clients.