China opens floodgates for cheap funding to foreign borrowers

China: China is the world's second-largest economy and a key player in global finance and bond markets. Regulators have enabled greater offshore use of panda bond proceeds, allowing foreign borrowers to tap into low-cost yuan funding. This development stems from policies supporting capital outflows amid domestic economic conditions. Yield Trends: Chinese government bond yields are declining while yields in major economies like the US rise, creating attractive borrowing opportunities in yuan. Bond Issuance: Chinese regulators have approved a record share of panda bond proceeds for offshore use by foreign issuers. Investor Access: Policies expanding foreign investor access to onshore bond financing tools, such as repos, are advancing despite some frictions.