Beijing blocking bond sales
29 August 2006
The State Council may be blocking the sale of up to US$3 billion in bonds from different government agencies, the South China Morning Post reported. Citing market sources, the newspaper said the government is blocking the sales because they could make it more difficult to manage the yuan. The Ministry of Finance, China Development Bank and the Export-Import Bank of China had all planned bond sales later this year. "Why do it?... It brings more money into the system and puts pressure on your currency," one source said. With reserves of foreign exchange near the US$1 trillion mark, Beijing is under increasing pressure to revalue the currency.
