UPDATE 1-China Mandates Banks for New Euro-Denominated Government Bonds



Abhinav Ramnarayan and Marc Jones 2 MIN READ | Reuters

LONDON, Nov 16 (Reuters) – China has mandated banks for a new tranche of euro-denominated international bonds, according to a note to investors seen by Reuters.

The bonds will follow a similar move a year ago, which was the first time in 15 years China had issued euro-denominated government debt.

One source close to the deal added there were likely to be five tranches of bonds adding up to a “minimum” of between 5 and 8 billion euros ($5.9-$9.4 billion).

The move comes amid a sudden rush of demand for emerging market debt in the wake of Joe Biden’s U.S. presidential election win and last week’s breakthrough with a coronavirus vaccine.

The ‘real’ yield premium China’s bonds offer once inflation is factored in compared to U.S. and European government bonds has also increased following this year’s emergency rate cuts and stimulus from the Federal Reserve and European Central Bank.

To read the full article, click here.