Dollar-denominated bonds sold by junk-rated Chinese developers remain a minefield for investors, as another depressing year of losses and defaults in the real estate sector draws to a close, according to money managers.
“China’s property sector is not out of the woods,” said Andy Suen, co-head of Asia ex-Japan fixed income at PineBridge Investments, which managed US$155.2 billion across global asset classes as of September.
“We don’t have high [confidence] in this sector. We’re still very cautious.”
China’s US dollar-denominated high-yield bonds, dominated by property debt, have landed investors a 22 per cent loss so far this year, after a 33 per cent slump in each of the past two years, according to the ICE Bank of America Index.
Distress continued to spread through the property industry this year as China’s post-pandemic economic recovery…
