China High-Grade Dollar Bonds Provide a Relative Haven Amid Rout

Many asset classes have been sliding of late in the wake of hawkish central banks and recession fears

(Bloomberg) — Investment-grade dollar bonds from Chinese issuers have been a relative bright spot during the ongoing global rout, and some credit investors expect continued outperformance.

The nation’s high-grade notes have lost 2.3% this month, compared with a 5.6% decline for dollar bonds in a global benchmark, according to Bloomberg indexes.

The Chinese securities weakened further Tuesday, according to credit traders. They had their biggest loss since early August on Monday, but global peers fell the most in three months while dropping for an eighth session, their longest losing streak since 2016.