PBoC to start borrowing government bonds as yields fall

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


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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