China's latest rate cut has improved sentiment in Asia's fragile high-yield bond market, prompting some investors to look for a good entry point after weeks of heavy selling. After the People's Bank of China last Tuesday cut interest rates and lowered the proportion of reserves that banks are required to hold, investors such as private banks were immediately spotted covering shorts in PRC property bonds, according to a trader. Asian high-yield bonds rose as much as a point that day, he said. The central bank's move partly alleviated worries linked to China's economic slowdown and the renminbi devaluation, allowing funds to trickle slowly back into regional high-yield bond markets.
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