China’s government bonds were the single gainer among the 20 largest global debt markets in the first quarter of the year, according to a report.
- Data on Bloomberg Barclays indexes found that Chinese sovereign bonds rose 1% in the quarter. Their lack of correlation with overseas bonds created an alternative for investors to park funds amid the debt selloff.
- Securities made the bulk of their quarterly gain in March when they grew 0.9%, bouncing back from earlier weakness caused by concerns on potential tighter funding conditions.
- Analysts say the debt tumbled “too quickly” before the Lunar New Year holiday, as traders bet that the People’s Bank of China would tighten liquidity. With tighter monetary policy priced in, bonds have become resilient and steady.
- Japan ranked second as it handled investors a narrow loss of 0.4% during the period. Its securities led developed nations, as declines were limited by the Bank of Japan’s vow to keep yields low and stable to contain the COVID-19 fallout.