Weaker Yuan, More Yuan

Caixin: Panda Bond Sales Surge in First Half 2016 as Costs Sink on Weaker Yuan

The value of panda bonds issued in the first six months of 2016 was more than double that issued in the whole of last year due to a fall in financing costs, but barriers including regulatory uncertainties on capital repatriation have kept potential issuers away from the market, JPMorgan Chase & Co. said.

From January to July 5, the amount of panda bonds, or yuan-denominated bonds issued by foreign entities on the mainland market, reached 29 billion yuan, according to a report published last week by the financial services provider. Only 12 billion yuan worth of bonds were sold last year and less than 5 billion yuan worth of bonds were issued each year from 2005, when the market was established, to 2014, the report showed.

One interest rates fall and depreciation expectations really set in, foreigners borrowing in yuan will pick up...