Basement Yields for China's Municipal Bonds

Safe-haven investors cheered October 20 on news that the State Council had approved the cities of Shanghai and Shenzhen along with Zhejiang and Guangdong provinces as pilot areas for China's first municipal bond auctions since 1995.

The decision to permit localized fund-raisers ended a 16-year lull for municipal bonds imposed by the central government through the national budget law.