China borrows negative rates for the first time
China borrows negative rates for the first time

China borrows negative rates for the first time

The Chinese government issued negative interest rates for the first time on Wednesday In bond sales that attract the attention of major investors, according to Deutsche Bank (D), A bank that helps manage business.
Faced with lower interest rates at home, European investors kept most of the debt down. Because they seek to be exposed only to the major global economies Expected to grow This year.

Chinese sales, which last attracted about $ 16 billion ($ 18.9 billion) for bonds, were valued at $ 4 billion ($ 4.7 billion) in equity, including five-year debt, with a yield of 0.152%. China also sold 10- and 15-year bonds with yields below 1%.

Investors include central banks, sovereign wealth funds and global asset managers covering Europe, Asia and the United States. European investors account for 85% of 15-year debt and about two-thirds of short-term bonds, according to Deutsche Bank.

“It shows that investors have not yet registered with China and of course there is a shortage of value in these bonds,” said Sam Fischer, head of the capital market of Deutsche Bank.

European investors seize the opportunity to invest in higher-yielding debt than they have in Europe, where the central bank has cut interest rates to record lows and highs. pumped over one trillion euros into financial markets To prevent damage from epidemics. Yield on five-year German government bonds Was about minus 0.75% on Thursday, according to Refinitiv.

The sell-off also indicates that investors want to face more of the Chinese economy, which is recovering from the epidemic at a faster pace than Europe and the United States.

The release of the newspaper shows that international investors have confidence in China’s strong economic recovery and future development despite the global epidemic of Covid-19, the statement said.

Follow a Historical contraction In the first quarter of 2020, China’s economy has Recover quickly, With industrial production and retail Increased sharply Last month.
At the same time, blocking restrictions in the US and Europe to prevent Rice spikes Coronavirus cases threaten to guide those economies Return to recession In the fourth quarter.

In a statement posted on its website, the Chinese Ministry of Finance said the bond sale reflects China’s intention and commitment to open up to the outside world and further integrate into international capital markets.

This is China’s second-largest international retail sale in months, after it raised $ 6 billion in October, including US investors. Last November, the country sold euro-denominated bonds for the first time since 2004, according to Allen & Overy, which recommended the auction.

Shanshan Wang contributes reportinຊ.