China’s first-ever sale of a negative-yield bond drew strong demand from investors seeking exposure to an economy that is returning to pre-pandemic growth rates.
Context
China’s first-ever sale of a negative-yield bond drew strong demand from investors seeking exposure to an economy that is returning to pre-pandemic growth rates.
Background
The current situation of Indian Bond yields
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Analysis
What are negative-yield bonds?
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Why are they in so much demand?
What factors are responsible for their high demand?
The negative side of the bond
Conclusion
While successful vaccine trials are showing a light at the end of the tunnel, Fed policymakers see a choppy outlook several months ahead. With the geopolitical troubles between the US and China now brewing for a few years, investors have been looking for signs of the Chinese diversifying out of their massive holdings of US debt that is held in Treasurys. So far, there has been little, if any, sign of sale of these Treasurys. Just as well, because the first large tranche of Treasurys that gets sold will likely be met by an anticipation by markets that more is to come, which could result in a huge impact on the price.
Verifying, please be patient.