# How China State Banks Are Quietly Backstopping Local Debt

Page: https://stenobird.com/podcast/china-economy-with-fexingo-beijing-s-policies-trade-and-asia-pacific-markets-7871760/how-china-state-banks-are-quietly-backstopping-local-debt
Text version: https://stenobird.com/podcast/china-economy-with-fexingo-beijing-s-policies-trade-and-asia-pacific-markets-7871760/how-china-state-banks-are-quietly-backstopping-local-debt.md
Podcast: [China Economy with Fexingo: Beijing's Policies, Trade, and Asia-Pacific Markets](https://stenobird.com/podcast/china-economy-with-fexingo-beijing-s-policies-trade-and-asia-pacific-markets-7871760)
Published: 2026-06-14T18:32:09+00:00
Episode link: https://audio.fexingo.com/business/china-economy/episode-0052.mp3
Audio file: https://audio.fexingo.com/business/china-economy/episode-0052.mp3
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Duration seconds: 480

## Resource

Episode 52 of China Economy with Fexingo: Lucas and Luna examine a little-noticed shift in China's financial system: state-owned banks are increasing their holdings of local government bonds at the fastest pace in years. With the yuan at 6.77 per dollar and trade surplus narrowing, Beijing is leaning on its biggest banks to absorb provincial debt. The hosts unpack what this means for investors holding China ETFs like FXI and MCHI, and why foreign buyers are returning to Chinese bonds despite the slowdown. A granular look at one of the underreported dynamics in today's China economy. #ChinaBanks #LocalGovernmentDebt #StateOwnedBanks #FXI #MCHI #Yuan #ChinaEconomy #BondMarket #TradeSurplus #BeijingPolicy #Economics #AsiaMarkets #ChinaDebt #FexingoBusiness #BusinessPodcast #Podcast #ChinaFinance #CentralBanking Keep every episode free: buymeacoffee.com/fexingo

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