【Text by Observer Net, Qi Qian】

Xinhua News Agency reported that on November 7, the Ministry of Finance's Office of Information learned that, after being approved by the State Council, the Ministry of Finance will issue Euro sovereign bonds in Luxembourg during the week of November 17, 2025, with a scale not exceeding 4 billion Euros.

According to Bloomberg, China issued 4 billion Euros (32.9 billion RMB) of Euro-denominated bonds, which attracted record demand. The report said that this is the latest indication of growing investor interest in Chinese sovereign bonds.

A source with knowledge of the matter stated that the project was divided into two parts, with the shorter-term four-year bond priced at the mid-swap rate plus 5 basis points, 28 basis points lower than the initial quote; and the longer-term seven-year bond priced at the mid-swap rate plus 13 basis points, 38 basis points lower than the initial quote.

This source said that the subscription multiple for the Chinese issuance of Euro sovereign bonds exceeded 26 times, with total subscription amount exceeding 104.5 billion Euros. Other sources said that this was the highest demand for Chinese Euro-denominated bond issuances.

The report mentioned that this Euro bond followed the recent issuance of U.S. dollar sovereign bonds by China.

In early November, the Chinese Ministry of Finance issued 4 billion U.S. dollars in sovereign bonds, with the three-year bond having a coupon rate of 3.625%, comparable to the yield of U.S. Treasury bonds of the same maturity, and the five-year bond pricing only 0.02 percentage points higher than U.S. Treasury yields. According to reports, this transaction attracted strong investor demand, with the five-year bond receiving 30 times over-subscription, more than half of the orders coming from central banks, sovereign wealth funds, and insurance companies.

According to reports, in the U.S. bond issuance, central banks, sovereign wealth funds, and insurance companies received an allocation ratio of over 40%, higher than last year's 11%, while the share of Asian investors dropped from 68% to about 50%.

Analysts believe that this change highlights the increasing confidence of global reserve managers in China's creditworthiness.

Bloomberg said that China usually raises funds once a year in the global debt market, aiming to build a more complete sovereign yield curve, providing a benchmark for Chinese enterprises to price their bonds. This is particularly important in the relatively thin Euro market.

Zhu Lei, Head of Fixed Income at Fidelity Asia, said: "Global investors are rushing to buy Chinese sovereign bonds as part of their diversification strategy. Due to strong exchange rate appreciation, narrowing credit spreads, and attractive returns, there is high demand for Euro assets."

Eugene Ng, Head of Debt Capital Markets in Greater China at HSBC, said that China is demonstrating confidence in its credit reliability and intends to position Chinese sovereign debt as a benchmark in the global market. Ng added that the successful issuance of the U.S. dollar bonds has boosted confidence in the Euro bond issuance, and European investors' participation shows broad support for Chinese sovereign bonds across Europe.

This article is an exclusive article by Observer Net. Reproduction without permission is prohibited.

Original: https://www.toutiao.com/article/7574263857791730210/

Statement: This article represents the views of the author. Please express your opinion below using the [upvote/downvote] buttons.