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China said to have increased holdings of NZ Govt bonds

China has increased its holdings of New Zealand's government bonds in the past three months, and the New Zealand Debt Management Office (NZDMO) is open to the idea of issuing debt denominated in China's currency.China's increased holdings helped boost loc

NZPA
Thu, 18 Nov 2010

China has increased its holdings of New Zealand's government bonds in the past three months, and the New Zealand Debt Management Office (NZDMO) is open to the idea of issuing debt denominated in China's currency.

China's increased holdings helped boost local trading, NZDMO's treasurer Philip Combes said, according to Bloomberg.

Mr Combes was at a Euromoney conference in Beijing today.

New Zealand may consider selling notes denominated in China's currency "as long as it's cheaper than borrowing in New Zealand dollars," he said.

Foreign investors held 64.6 percent of New Zealand government debt in October, compared with 64 percent a month earlier, and 62.8 percent in July, according to figures published by the Reserve Bank of New Zealand on November 12. The percentage was 76.6 percent in July 2009.

The NZDMO is responsible for the management of the Government's debt and associated assets and is part of Treasury. It issues a range of domestic and foreign-currency debt securities and at present debt issuance is concentrated on domestic currency instruments.

The office introduced a new government bond maturing in March 2019, with a coupon of 5 percent, at its September bond tender. The bond was designed to fill a gap in the yield curve between the bonds maturing in 2017 and 2021 as demand for longer-maturity government bonds had been strong in recent tenders.

NZPA
Thu, 18 Nov 2010
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China said to have increased holdings of NZ Govt bonds
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