PBoC to start borrowing government bonds as yields fall

Analysts expect central bank to sell in secondary market to stabilise yields

Renminbi

The People’s Bank of China (PBoC) said on July 1 that it will borrow government bonds from some primary dealers in the near future.

Some analysts see the PBoC’s step as a precursor for future bond selling in a bid to support falling yields. The central bank may also be paving the way for a longer-term transition to a new monetary policy framework, according to some observers.

In a statement, the central bank said it made the decision to “maintain the stable operation of the bond market”, after

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