Chinese green bond issuance rebounded in the first quarter of 2018, raising about $4.8 billion, a recovery from a 30-year low reached last year, according to a Reuters poll of institutional investors. The green bond issuance in the first quarter was sharply higher than the $3.3 billion seen in all of 2017, and weighed on an overall declines in issuance of bonds issued in 2017 as the markets absorbed new issuance. Holdings of green bonds, which closed 2017 below 200 billion yuan ($31.89 billion), stood at 128.4 billion yuan, the most since the beginning of 2013. The green bond market usually provides a lifeline to some of the world’s biggest resource and political powerhouse economies such as China, whose growth has slowed to below 7 percent over the past two years from around double digits three years ago. Chinese bankers, issuers and foreign investors say that only tighter regulation in key markets has led to a sharp rise in the issuance of green bonds this year. However, there is significant uncertainty about where the green bond market will head following its lows in the first quarter and doubts about the sustainability of the trend. In late April, S&P Global issued an emergency credit rating downgrade on China’s domestic bonds, citing prospects for a broader “one-China” bond issue, code for a two-way issue between Hong Kong and China. The rating agency cut the ratings to “negative” from “stable”, warning that the cut was highly conditional on the fate of the yuan currency, after which it could again downgrade. The risks posed by this move are “weighing on sentiment towards sovereign debt in China,” a bank official told Reuters, adding that the recent increase in Chinese bonds issuance has a potential to further limit the fluctuations of the green bond market. Despite China’s double-digit green bond issuance in 2017, it saw sluggish issuance in recent years, with a stable outlook.