China Dev Bank fails to sell out 10-year bonds

China Development Bank, one of three policy banks lending in line with government initiatives, failed to sell out a 10-year bond issue on Wednesday, traders said.
The bank sold 27.06 billion yuan ($4.0 billion) of the bonds, after offering 59.18 billion yuan with a coupon of 3.42 percent, the traders said.

Some saw the auction result as a negative sign for the long end of the bond market. Secondary market yields have backed up in the past two days amid talk that a plunge earlier this month, on expectations for falling inflation and further easing of monetary policy, was too fast.

The 3.42 percent coupon was above Tuesday's indicative secondary market yield of 3.3380 percent bid for 10-year financial bonds issued by policy banks , according to Reuters Reference Rates.