Greater convergence likely between offshore, onshore bond trading

Recent data are pointing to greater convergence between the onshore renminbi bond market and the much smaller offshore market, which means overseas investors would have to pay greater attention to issuers' credit developments in the onshore market.

The most illustrating display of the greater convergence is that yield curves on Chinese government renminbi bonds traded onshore and offshore are more closely aligned, as has also been the case with interbank offered rates.

"(The two markets) demonstrate increasingly similar - if not eventually identical - trends and become subject to similar drivers," said the quarterly report by Moody's Investors Service Inc.