Forex News May 28, 2022
China
China opens its exchange bond markets to foreign investors.
The People’s Bank of China announced another step toward greater global access to China’s financial markets. According to a Friday statement from the People’s Bank of China, China will allow foreign institutional investors to purchase bonds traded on its smaller exchange market.
Qualified foreign institutional investors, ranging from central banks and sovereign funds to commercial banks and pension funds, will be able to trade bonds and invest in derivatives on the exchange market, in addition to other bond-based instruments permitted by the PBOC and China’s securities regulator.
Evergrande
The Chinese property sector’s train wreck continues: Evergrande will roll defaulted debt into new bonds.
On Friday, Justin posted the main point of the defaulted debt juggling:
Evergrande is said to be considering issuing new bonds to repay offshore creditors the principal and interest on their debt.
Reuters has posted more information, which makes for interesting reading as Evergrande attempts to sort out $22.7 billion in offshore debt deemed in default after missing payment obligations late last year.
According to one of the sources, Evergrande is looking to repay offshore creditors the principal and interest by converting them into new bonds, which will then be repaid in instalments over a seven to ten-year period.