How CERC default feeds into broader EM concerns

China Energy Reserve and Chemical's bond default shows credit risk in China is rising and spilling over into international markets, so bond investors need to be increasingly selective.

Fears that more Chinese corporate borrowers are likely to default in the coming months and years have cranked up a notch after China Energy Reserve and Chemical (CERC) failed to repay its dollar bond, spreading some of the disquiet that has been rumbling onshore in China onto offshore markets.

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