New gauges are showing Chinese banks are becoming increasingly reluctant to lend to one another, refreshing fears about another spike in this country's intra-bank lending rates and the overall credit markets.
At the same time, investors are also showing a preference for safer government bonds.
The spread between the two-year sovereign yield and the similar-maturity interests-rate swap is around 110 basis points, signaling significant financial stress.
As of February last year, the spread only averaged around 20.
Adding to the concern, billionaire investor George Soros has come out recently suggesting the situation in China right now mirrors that in the US before the 2008 financial crisis.
I'm joined on the line now by Cao Can, our financial commentator.
