China to launch ultra-long bonds for economic support

China plans to launch ultra-long bonds this week to boost its slowing economy, aiming to raise 1 trillion yuan ($138 billion) for infrastructure and security projects announced by Premier Li Qiang in March, Xinhua reported on Monday.

The first batch of 30-year bonds will be available on Friday, followed by 20-year bonds on May 24th, and 50-year instruments by June 14th.  Specific issuance amounts have not been disclosed yet.

Despite concerns about a prolonged property slump and weak consumer demand, China is sticking to its 2024 GDP growth target of around 5 per cent.  Some analysts, however, predict a slower pace.

Weekend data from the central bank revealed a record low for broad credit growth – 8.3 per cent in April.  Julian Evans-Pritchard, a China economist, noted this slowdown as a challenge for policymakers to maintain current GDP targets given diminishing investment and property purchase activity.