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Chinese yields fall further amid PBoc easing. Download FTSE Russell's latest report to learn more now!

Publisher: FTSE Russell

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Chinese yields fall further as lower inflation gives scope for more easing
Chinese spreads tightened versus the G7 in April, as yields fell more, helped by PBoC easing. A further fall in Chinese inflation, to below 1% y/y, gives policymakers more room to boost growth. Chinese $ IG credits matched US IG credit returns, but Chinese HY credits remain negative. Indonesian bonds led April gains. 

Macroeconomic backdrop −IMF retains 5.2% GDP growth forecast in 2023 for China, despite property challenges
Weak global growth, and low inflation, reinforce the case for domestic-led growth in China, and further PBoC easing.

Chinese bonds − onshore bond yields trended lower in April and YTD, stable yield curve
Domestic credit spreads continued to tighten in April, led by short green spreads. Chinese 10s/2s curve remains stable, and uncorrelated with inverted G7 curves.

Chinese and Asian bonds − Asian govts spreads tightened in April, as yields fell more than G7
Asian government bond spreads tightened marginally versus US Treasuries, as Asian bond yields fell further in April. Chinese $ high yield spreads widened further, as markets digested the debt restructurings and property sector report.

Performance − Indonesian and Indian governments strongest performers in April, Korea underperformed
Indonesian, Indian and Singaporean government bonds performed best in April, in both dollars and renminbi. Korean, Japanese and Australasian bond returns in US dollar lagged on weaker currencies.

Global bond market returns, historical bond yields, duration and market value, foreign exchange returns.


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