China Likely to Sell 50-year Govt-bonds in Q4 to Test Demand

China is likely to sell 50-year government bonds in the fourth quarter of the year to sound out the market enthusiasm, disclosed people who attended the quarterly government bond financing meeting lately.

The government bonds, the longest in term in history, is expected to be small in size to test the market demand, predicted an executive for an insurance company, capping the size at CNY 20 billion to CNY 30 billion. The major buyers of the long-term government bonds are forecasted to be insurance firms, the National Social Security Fund (NSSF), and big-sized state-backed lenders.

The long-term government bonds will help enrich the investment products, complete the benchmark yield curve, and optimize the local bond market in the long run, pointed out a market observer, noting that the yield of the to-be-launched bonds will stand below 5% although it is difficult to predict the country's economic landscape in 50 years.