China Rate Cut Gives Investors Reason to Return to Yuan Bonds

(Bloomberg) — China’s unexpected decision to cut one of its key short-term policy rates is giving fund managers a reason to return to the nation’s bonds after trimming holdings every month this year.

The country’s sovereign debt looks attractive on growing signs policymakers will do more to shore up the economy, according to HSBC Asset Management. Further fiscal stimulus may set off a significant rally in the nation’s bonds, BNY Mellon Investment Management says.