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China’s central bank halts bond buying, possibly with eye on yuan
CBNC ^ | 01/09/2025

Posted on 01/09/2025 11:16:47 PM PST by BenLurkin

China’s central bank said on Friday it has suspended treasury bond purchases, triggering a jump in yields and spurring speculation that the move was aimed at defending a falling currency.

The People’s Bank of China cited a shortage of bonds in the market as the reason it was halting the purchases, which were part of its operations to ease monetary settings.

But the move coincides with a brutal selloff in other major bond markets around the world and suggests China’s central bank is trying to ensure yields at home also rise in tandem, analysts say.

Yields, which move inversely to bond prices, jumped following the central bank’s announcement.

China’s 30-year treasury yield climbed five basis points in early trade while the 10-year yield rose four basis points. Both hit record lows recently. The yuan too rose slightly.

“One of the key reasons for the depreciation of the yuan is the widened yield gap between China and the U.S., so the central bank is sending a signal to the market that the yield rate is unlikely to fall further,” Ken Cheung, chief Asian FX strategist at Mizuho Bank.

(Excerpt) Read more at cnbc.com ...


TOPICS: Business/Economy
KEYWORDS: pboc

1 posted on 01/09/2025 11:16:47 PM PST by BenLurkin
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To: BenLurkin

China is screwed, because their population may be as low as 800 million by those who have knowledge.


2 posted on 01/09/2025 11:39:03 PM PST by Jonty30 (Liberals are a fulfillment of II Tim3:5. We are instructed to have nothing to do with those people. )
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To: Jonty30

I have heard the same thing.


3 posted on 01/09/2025 11:41:07 PM PST by LukeL
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To: Jonty30

That must be true because someone said it on the internet. /sarc

But I have massive doubt about that claim. Just sayin’.


4 posted on 01/10/2025 2:38:44 AM PST by House Atreides (I’m now ULTRA-MAGA-PRO-MAX)
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To: Jonty30

“China is screwed, because their population may be as low as 800 million by those who have knowledge.”

That’s more than twice the US, so hard to see how they’re ‘screwed’.


5 posted on 01/10/2025 3:22:41 AM PST by BobL
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To: BobL

If China has been borrowing money based on a population of 1.4 billion, but there are only 800 million, there isn’t enough people to pay back that debt.

Also, it’s not just population, but the demographics of the population. Old people are not producers to fund the government, but consumers. If there are too many old people, there are not enough people to support them and the young, who are supporting them, will not have enough to support themselves when they reach retirement age.


6 posted on 01/10/2025 3:26:34 AM PST by Jonty30 (Liberals are a fulfillment of II Tim3:5. We are instructed to have nothing to do with those people. )
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To: Jonty30

“If China has been borrowing money based on a population of 1.4 billion, but there are only 800 million, there isn’t enough people to pay back that debt.”

That’s a new one - does that mean if I have more kids, I can borrow more money. I kind of doubt it.

“Also, it’s not just population, but the demographics of the population. Old people are not producers to fund the government, but consumers. If there are too many old people, there are not enough people to support them and the young, who are supporting them, will not have enough to support themselves when they reach retirement age.”

China, like Canada now, has a way of dealing with old people who are a burden on their country. It won’t affect them (or Canada) nearly as much as civilized countries.


7 posted on 01/10/2025 3:30:40 AM PST by BobL
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To: BobL

If the population is getting old how they gonna invade Taiwan?

Older GI’s think for themselves.


8 posted on 01/10/2025 5:59:10 AM PST by DIRTYSECRET
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To: DIRTYSECRET

“If the population is getting old how they gonna invade Taiwan?”

When you have 40 times the population, a somewhat lower birthrate than your adversary tends to not matter much.


9 posted on 01/10/2025 6:06:36 AM PST by BobL
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To: BenLurkin

The real and unstated reason is that there are no available funds to purchase the bonds.

Trying to analyze the China economy with conventional parameters is foolishness. There are no correct numbers collected and published in China. The economic statistics mechanism has been destroyed for months now


10 posted on 01/10/2025 6:10:17 AM PST by bert ( (KE. NP. +12) Where is ZORRO when California so desperately needs him?)
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