January 3, 2023

Fixed Income Insights (China Edition) - January 2023

Monthly report

Covid surge and low inflation leave the People's Bank of China room to ease further, if needed

  • Macroeconomic backdrop − G7 slowdown but US rebounds in Q4; sticky inflation is key for central banks
  • Chinese bonds − Government curve mostly bear flattened in Q4; green spreads widened
  • Chinese and Asian bonds − Great curve flattener and inversion continued in Asia; Chinese spreads remained volatile
  • Performance − Malaysian and Singaporean governments led 2022 gains in RMB; Bunds and JGBs lagged

This report provides actionable insights on currency-adjusted performance, macro drivers, shifts in yields, spreads and curves across conventional government and corporate bonds, for both renminbi and dollar-denominated issues.

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