Jakarta, May 11 -- Indonesia plans to issue yuan-denominated Panda bonds in June, seeking lower yields and broader funding sources, Finance Minister Purbaya Yudhi Sadewa said on Monday.

Panda bonds are issued in mainland China by foreign entities, while Dim Sum bonds are issued offshore, mainly in Hong Kong, for international investors.

Purbaya said Panda bonds could offer yields of 2.3 percent-2.5 percent, lower than Dim Sum bonds at 2.5 percent -2.9 percent .

He said the issuance would diversify Indonesia's funding sources and reduce reliance on the U.S. dollar.

The ministry has yet to set a target issuance size.

Purbaya instructed financing and risk management director general Suminto to scale up issuance if investor demand is str...