Short end still dominates in MoF auction despite long end convergence

The short end of the curve again dominated Wednesday's Rmb16bn auction of offshore renminbi bonds from China's Ministry of Finance (MoF), with more than half the total Rmb41.8bn demand coming into the three year tranche. That much was expected, given global fears of rising interest rates, but it was the central bank allocation that gave an intriguing insight into just how strongly those concerns are driving markets.