Beijing’s first bond offer to US investors draws record demand

Beijing’s first bond offer to US investors draws record demand

Beijing sold dollar debt directly to US buyers for the first time, with a $6bn offering drawing record demand on the back of China’s economic recovery from coronavirus.

The bonds sold by China’s finance ministry on Thursday drew orders worth more than $27bn, or roughly $10bn more than an offering of the same size last year, according to bankers on the deal.

The Chinese government’s move just weeks before Americans head to the polls for the presidential election shows how tightly the financial systems of the two countries are linked, despite a trade war and tensions over technology and geopolitics.

Bankers involved in the bond sale said US demand was strong, with about 15 per cent going to American investors.

Investors were attracted in part by the Chinese bonds’ high yields compared to those issued by the US government.

The bond sales received “a strong reception from US onshore real money investors”, said Samuel Fischer, head of China onshore debt capital markets at Deutsche Bank, which helped arrange the deal.