Convertible bonds represent an immature and very tiny segment of China’s bond market. That is unlikely to change unless and until there is a sustained rally in A-shares.
Issuance of dim sum bonds in 3Q13 was minimal. There are good reasons to look for it to pick up significantly in the current quarter.
Issuance of US dollar bonds by leading property companies (especially) will continue to grow strongly in the coming weeks and months.
In another challenging month for investors in China’s fixed-income markets, corporate bonds issued by the leading property developers outperformed.
The latest data shows that offshore renminbi (CNH) deposits in Hong Kong have been falling, as protagonists have repatriated funds to the mainland, where M2 growth has been slowing. Liquidity is likely to remain constrained in CNH markets in coming weeks.
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