SHANGHAI: The Chinese government will begin auctions this week of a planned issue of 1 trillion yuan ($140.98 billion) of special treasury bonds to help finance recovery from the coronavirus pandemic, sources told Reuters on Monday.

Sales will be completed by the end of July, according to the sources, who attended a meeting held by China's Ministry of Finance, which will issue the bonds.

China announced plans last month to sell 1 trillion yuan of special treasury bonds to help fund economic stimulus in the wake of the pandemic.

Its plans are being closely monitored by market participants, as when and how the bonds are sold will affect market liquidity.

According to the sources, 70pc of the special treasury bonds will have a 10-year term, 20pc will have a maturity of five years and the remainder will be seven-year bonds.

China's economy shrank 6.8pc in the first quarter from a year earlier, the first contraction in decades, and Beijing dropped its annual growth target for the first time.