For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. Onshore rates are stable and even have room for easing, he said, adding that together with stable government support, these bonds will benefit. "In an environment when the overall global financial markets experienced big retreats and when the recession risk is high, the spotlight is on onshore yuan-denominated bonds and offshore US-dollar investment-grade bonds," Liu said. The global bond markets including that in the US are also under pressure due to global interest rate increases, he said.Įxperts still view the Chinese credit market as investible, with some investment-grade issuers such as state-owned enterprises being favoured. However, the downturn in the offshore Chinese credit market needs to be viewed within a wider scope, said Eric Liu, head of fixed income at Harvest Global Investments. As such, the potential for default remains high." "We don't expect the housing market to recover any time soon. "While we believe the policy crackdown on China's property sector has bottomed, the down cycle has further to go, considering the rocky sales, weak sentiment and deteriorating financing conditions faced by developers," said Chang Li, director at S&P Global Ratings. 18 with 694 million in dollar bonds outstanding. The Shanghai-based developer said in a filing that it doesn’t expect to repay a 250 million dollar bond due Oct. Ronshine China Holdings and Shimao Group Holdings also missed two deadlines each for dollar bonds earlier this month. 14:33 No comments Sinic Holdings Group has become the latest to warn of default as the property market in China seemingly turns cold. More recently, the world's most leveraged developer, China Evergrande Group, failed to get investor approval to further delay an onshore bond payment, which could become its first onshore bond default. "Credit risk is still relatively high, firstly in the property sector, and secondly the is sending shocks to the financial and banking systems," said Meng at ANZ. Home builders in the first half contributed almost all of the US$26.2 billion in delayed offshore bond payments so far this year, Bloomberg data also show. Property companies have US$31.7 billion in bonds due through the rest of the year, according to data from Bloomberg. These predictions come as economic growth in the world's second-largest economy slowed to its lowest rate in two years, new home prices fell for the 10th straight month, and unfinished homes sparked a mortgage boycott movement - all against a backdrop of large fluctuations in global financial markets amid increasing interest rates and concerns of recession.Ĭhina's bank regulator on Monday instructed lenders to provide credit to eligible property developers to help them complete unfinished homes, opening the liquidity taps for the first time since an August 2021 central bank loans cap sent the industry into a tailspin.
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