Chinese bonds see worst rout in a year as data hurts betting

China’s benchmark sovereign bond yield rose the most in a year, as accelerating inflation has cast doubt on whether the nation’s ratings can maintain their global lead.

The 10-year government bond yield climbed six basis points to 2.87% on Monday, its largest increase since July 2020, after eight straight weeks of decline. This was after inflation at China’s exit from factories in July unexpectedly returned to a level 13-month high of 9% reached in May. A rise in short-term interbank rates also weighed on public debt.