In the January-July period this year, local governments in China have issued local treasury bonds amounting to RMB 3.3931 trillion ($0.48 trillion), up 56 percent year on year.
The figure includes municipal bonds of RMB 2.5529 trillion ($0.36 trillion), refinancing bonds worth RMB 807.7 billion ($115.4 billion) and replacement bonds amounting to RMB 32.5 billion ($4.6 billion), according to the latest statistics from the Ministry of Finance (MOF). The value of the local treasury bonds issued in the first seven months of this year is not far from the total bonds worth RMB 4.1652 trillion issued in the whole of 2018.
Zhao Quanhou, director of the financial research center at the Chinese Academy of Fiscal Sciences, stated that since the beginning of this year the interest rate of new local treasury bonds has decreased, indicating that the moderately loose monetary policy in China has provided support for local treasury bond financing and effectively reduced the bond financing costs of local governments.