China’s central bank walks a tightrope
People’s Bank of China draws down Covid support amid state-linked borrower defaults, a bond market sell-off and new recovery doubts
Multiple signals from Beijing suggest that the People’s Bank of China is on course to withdraw its Covid-19 emergency support. If that is the case, it is flying in the face of powerful headwinds.
These headwinds include a number of recent defaults by state-linked borrowers, a powerful selloff in the corporate bond market, and worries among investors that China’s recovery is less durable than hoped.
Export credit talks collapse amid West’s concern over China loans t.co/xW5Key88QZ
— SCMP News (@SCMPNews) November 19, 2020
— Tracy Alloway (@tracyalloway) November 23, 2020