China’s Ministry of Finance had its a bond auction failure on Friday, selling 20.7 billion yuan ($3.3 billion) of one-year debt, according to Bloomberg.
This was less than the 28 billion yuan in debt the ministry had planned to auction. The average yield was also higher than expected.
This bond failure comes as concerns about a Chinese economic slowdown mount.
China has set a growth target of 7.5% and economists think the government has a floor of 7%. China’s Labour Ministry says 7.5% growth generates 10 million jobs and that growth below 7% could cause high unemployment. Meanwhile, premier Li Keqiang has dismissed chatter about further speculation because of “temporary” volatility.
The last time China had a failed bond auction was ahead of the liquidity crunch of June 2013. The auction was also said to have failed among concerns about rising money market rates.
The People’s Bank of China injected money last week for the first time since January, which some thought was a sign that the central bank was acting to ward of any chance of tightening liquidity.
For now, all eyes are on China’s Q1 GDP growth which is out at 10 p.m. ET on Tuesday.