China central bank fears Silicon Valley Bank redux as yields sink

PBOC rushes to curb possible bond bubble via guidance and regulatory enforcement

20240826N KRCB bank

Banks in China's Jiangsu province have been accused of manipulating government bond prices. (Photo by Noriyuki Doi)

NORIYUKI DOI, Nikkei staff writer

SHANGHAI -- As long-term government bond yields in China hover near a record low, authorities are scrambling to head off a bubble in the market that could put banks at risk, with limited success so far.

The People's Bank of China worries about a bubble in government bond prices that could eventually burst, causing yields to rebound and banks to suffer losses.

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