This article originally appeared in The Wall Street Journal.
By Lingling Wei
05 July 2011
BEIJING—A rush this year by issuers of risky bonds to tap the burgeoning yuan-debt market in Hong Kong has slowed, as investors are waking up to the idea that not every deal linked to China’s rising currency makes a good investment.
Since China relaxed its currency rules a year ago and put in measures aimed at encouraging the use of yuan outside its borders, the offshore market for bonds denominated in the country’s currency—dubbed dim sum bonds— has drawn a variety of issuers. For high-grade borrowers such as Chinese banks and government agencies, foreign financial institutions and multinational corporations, the …
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