AUD rockets on some kind of Evergrande bond payment

Wednesday, 22 September 2021

China Evergrande’s main unit Hengda Real Estate has clarified that it will make coupon payments for onshore bonds due tomorrow. It looks like it’s probably a default:

In a vaguely worded exchange filing on Wednesday, the unit said that the issue for its 5.8% 2025 bond “has been resolved via negotiations off the clearing house,” under a section in the filing on the bond interest payment.

And off the AUD goes:

Big miners are ecstatic!

Yields are up and copper is flying. Iron ore is flat.

And more payments dead ahead:

Coconuts.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.