China's US$21 trillion bond market breathes sigh of relief as data feeds resume
DATA feeds from Chinese money brokers resumed on most platforms on Friday (Mar 17) in a reversal of a regulatory ban introduced two days ago that frustrated traders and hit turnover in China’s US$21 trillion bond market.
Chinese money-brokers were told by regulators to cut data feeds on Wednesday to vendors that provide real-time bond price quotes, leaving traders scrambling to join QQ and WeChat messaging groups as workarounds.
Reuters reported late on Thursday that regulators had allowed data feeds to resume. Money brokers’ real-time bond price data reappeared on most financial information platforms on Friday, including Wind and Dealing Matrix, according to traders and screens seen by Reuters.
The dramatic policy U-turn as Beijing tightens its grip on a broad range of areas including finance, technology and data security, threatened business confidence and roiled the market, with bond trading volumes plunging over two days.
“Can you imagine how happy I am after experiencing such deep sorrow?“ said a bond trader. The feed cut had driven her crazy looking for alternative sources of price information, she said.
“Glad the problem is solved.”
The China Banking and Insurance Regulatory Commission (CBIRC), which regulates money brokers, has not responded to requests for comment on the data feed ban and reversal.
Regulators cited data security reasons when the ban was imposed. Following the ban, interbank bond market turnover tumbled 9% on Wednesday and another 16% on Thursday as traders had more difficulty accessing price information.
The ban was lifted after China’s central bank and the CBIRC summoned money brokers and some banks on Thursday afternoon to discuss the policy impact, Caixin reported on Friday.
The ban was lifted for most money brokers, including the joint ventures of NEX International, BGC Partners, Central Tanshi and Compagnie Financiere Tradition.
Popular platform qeubee, owned by Ningbo Sumscope Information Technology, and money broker Tullett Prebon SITICO (China), which supplies bond price data to Sumscope, remained subject to the data feed block. It was not immediately clear why.
The policy reversal suggests the industry-wide ban on data feeds was ill-conceived, traders said.
“I just couldn’t do my job properly,” said a bond fund manager who declined to be identified.
The ban created fresh problems in the market and the government didn’t offer any solution, he said.
Another trader lamented the huge impact from the short-lived ban: “I felt like I was blind. I had no idea whether the market was rising or falling.”
Some traders and analysts drew a parallel to a previous policy reversal in 2016, when China suspended its newly introduced stock market circuit breaker after the mechanism sparked sharp falls in share prices. REUTERS
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