By Scott Murdoch
(Reuters) -China is looking to raise $4 billion in a two-tranche dollar bond, according to a term sheet seen by Reuters, a week after Beijing and Washington agreed to a trade war truce.
The People’s Republic of China is planning a three-year dollar bond, which has an initial price guidance of three-year Treasuries plus about 25 basis points, the term sheet said. A five-year dollar bond has guidance of five-year Treasuries plus about 30 basis points.
The size of the deal is capped at $4 billion, according to the term sheet, although the order book has already reached more than $65 billion, a bookrunner’s message seen by Reuters showed.
The bond is the largest dollar-denominated deal for China in four years, according to LSEG figures.
China last year raised $2 billion in dollar bonds that were issued in Saudi Arabia, which were the first of their kind for China.
China’s Ministry of Finance did not immediately respond to a faxed request for comment from Reuters.
Trade tensions between China and the U.S. have eased significantly since Chinese President Xi Jinping and U.S. President Donald Trump met in South Korea last week to discuss a trade agreement.
Beijing said on Wednesday it would suspend its 24% additional tariff on U.S. goods for one year but retain a 10% levy.
China, the world’s top agricultural buyer, will also lift some tariffs of up to 15% on U.S. agricultural goods from November 10.
The U.S. said last week tariffs on China would be reduced by about 10 percentage points to 47% as part of a broad agreement reached between the two countries.
(Reporting by Scott Murdoch in Sydney; additional reporting Ethan Wang. Editing by Muralikumar Anantharaman and Sam Holmes)
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