China raises $6 billion in its biggest ever international bond sale


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China raises $6 billion in its biggest ever international bond sale

On Tuesday, the 26th of November 2019, Chinese Finance Ministry said that it had sold a record total of $6 billion worth of international government bond, as the world’s second-largest economy, manufacturing activities of which were drowned in to a three-decade low figure was looking to capitalize on its diving borrowing cost.

Aside from that, a source with knowledge regarding the subject-matter had unveiled on condition of anonymity as the source was not authorized to speak over the issue in public that the Chinese Finance Ministry had sold its sovereign bonds in four grades, while it had priced its 3-year maturity bonds 35 basis point above a benchmark US Treasury rate, 5-year bonds above 40 bps of US Treasuries and 10-year bonds at a 50 basis point alongside a 20-year bond at a 70 basis point above US Treasuries.

In point of fact, the unprecedent deals followed a worldwide rally in the financial markets which had pulled down global bond yields significantly lower, stoking concerns of a recession fear and downsizing the cost of financing in comparison to China’s previous issuance on a year-on-year basis, while $6 billion upsum raised in its recent government bond sale was almost 100 per cent higher than China’s Finance Ministry’s expectation, Refinitiv Capital Markets’ news service, IFR data had shown on Tuesday (November 26th).