The Ministry of Finance is flooding the bond market with $14 billion of debt to shore up regional government finances as the economy slows, driving yields higher.
The yield on benchmark five-year government notes rose 12 basis points, or 0.12 percentage point, in June to 2.92 percent, as similar-maturity rates in India fell 13 basis points.
The ministry sold 21 billion yuan ($3.3 billion) of five- year bonds at 3.07 percent on Friday on behalf of governments in Qingdao, Guangxi, Hainan, Chongqing, Shaanxi, Gansu and Xinjiang, the second of four such sales planned through July 16.
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