China is set to issue a $4 billion two-tranche U.S. dollar bond, according to a term sheet reviewed by Reuters, marking a major move in global debt markets just a week after Beijing and Washington reached a temporary trade truce.

The bond offering includes a three-year dollar bond with an initial price guidance of three-year U.S. Treasuries plus approximately 25 basis points, and a five-year dollar bond guided at five-year Treasuries plus around 30 basis points, the term sheet revealed.

While the deal is capped at $4 billion, the order book has already exceeded $65 billion, highlighting strong investor demand, a bookrunner’s message obtained by Reuters showed. This offering represents China’s largest dollar-denominated bond issuance in four years, according to London Stock Exchange Group (LSEG) data.

Last year, China issued $2 billion in dollar bonds in Saudi Arabia, marking its first such issuance outside the domestic market. China’s Ministry of Finance did not immediately respond to Reuters’ request for comment.

Easing U.S.-China Trade Tensions Boost Market Confidence

The timing of the bond issue coincides with a significant reduction in trade tensions between China and the United States. Last week, Chinese President Xi Jinping and U.S. President Donald Trump met in South Korea to discuss trade, resulting in a partial tariff rollback.

China announced it will suspend a 24% additional tariff on U.S. goods for one year while maintaining a 10% levy. In addition, tariffs of up to 15% on selected U.S. agricultural products will be lifted starting November 10. Meanwhile, the United States agreed to reduce tariffs on Chinese goods by roughly 10 percentage points to 47% as part of the trade agreement.

Why This Matters

China’s $4 billion dollar bond issuance reflects strong international investor confidence and a potentially stabilizing effect on global markets amid easing U.S.-China trade tensions. It also underscores China’s growing presence in international debt markets, as well as its strategic approach to currency and investment diversification.