China’s corporate bond defaults hit record high

In China, from January to June, defaults were recorded on corporate bonds totaling 116 billion yuan ($ 18 billion), which is an absolute record for the first half of the year for all the time of such observations. This is reported by the Japanese agency Nikkei with reference to the calculations of the Chinese research company Shanghai DZH.

The Nikkei notes that such a dynamics of defaults on corporate bonds in the PRC is alarming for foreign investors in these securities, which has already led to an increase in yields of up to 10% on bonds with low credit ratings. Shanghai DZH predicts that if the current dynamics are maintained, 2021 could set a new record for the volume of corporate bonds defaults. The previous record was recorded in 2020: 187 billion yuan ($ 29 billion).

Evgeny Khvostik

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