Researchers have recently studied the interactions between corporate and government bond issuances in a variety of countries. Some conclude that government bonds compete with private bond issuances, while others conclude the opposite. We study here the special case of China’s 2017 issuance of two sovereign bonds denominated in U.S. dollars. We find that corporate bonds experienced a decline in yield spreads, bid-ask spreads, and price volatility around the time this sovereign issuance was first announced. The results are particularly strong for corporate bonds with maturities similar to those of the USD sovereigns. We conclude that these new bonds served as useful reference instruments that helped investors price and hedge the risks impounded in Chinese corporate bonds.