Chinese monetary easing is here, but don’t call it QE

Saxo Capital Markets Australia

Multi-asset trading platform

We now know that the high profile debt-for-bond swap program of the Chinese government has officially failed. Beijing’s plan was to help local authorities refinance RMB 1tn (US$163bn) on debt due to mature this year. But underwriters were unable to attract enough investors who were interested in exchanging debt. The proposed business for investors was short-term, high-interest bank loans of sub-national governments for low-interest, long-term municipal bonds. Pauline Loong, managing director of Asia-analytica Research, explains that one of the possible reasons of this flop is “the unmentionable issue of creditworthiness (or the lack of it)”. But Loong says the episode has not stopped authorities from looking for ways to stimulate the economy. On the contrary, it has just embarked the People’s Bank of China into an easing program, but with its own characteristics. So don’t call it QE. To read more click here: (VIEW LINK)


Saxo Capital Markets Australia
Contributor
Multi-asset trading platform

Saxo Capital Markets (Australia) Pty Ltd is a wholly owned subsidiary of Saxo Bank A/S, a global online trading platform specialist. We enable investors the ability to trade FX, CFDs, Stocks, Futures & other derivatives from one account....

Expertise

No areas of expertise

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.