China Govt Bonds Mostly Lower On Fed's Bond-Buying Plan

China government bonds are mostly lower as the Fed's bond-buying plan hurts interest in safe-haven assets such as U.S. Treasurys, analysts say. "Selling pressure is increasing. Investors are concerned that the launch of the third round of quantitative easing by the Fed will prop up commodity prices in the global markets and reignite inflation pressures in China," says a trader at a local bank. Five of six government bonds that have been traded so far are lower. A 10-year bond issued in 2005 falls to CNY104.11 from CNY104.18 Thursday, with the yield at 2.7284% vs 2.6995%; a 20-year bond issued in 2001 dropped to CNY105.74 from CNY106.06, yielding at 3.5341% vs 3.4952%. Still, bargain hunting in maturities of less than a year help offset downside in the Shanghai Stock Exchange's government bond index, last flat at 134.63.

China Govt Bonds Mostly Lower On Fed's Bond-Buying Plan

Find us on Google+