The bond market sell-off to China: 10 year bond yields rose above 3.9%

Add time：[2024-12-28]

The inter-bank bond yields fell sharply upward synchronous expansion, more than 10bp. 10 years of national active coupon 170215 yield upward 11.76bp reported 4.5250%, 10 year treasury bonds active 170018 yield upward 11.52bp reported 3.94%, refresh a new high since mid October 2014.


Traders said last week, there was no obvious bad news, but the market liquidity, fundamentals and prospects are expected to the negative regulatory policy adjustment direction of bond market, the market sentiment is extremely fragile, spot bond yields upward quickly, stop pressure to further expand the spot decline.


Exchange and inter bank funds reproduction differentiation, exchange reverse repo rate bonds rose to expand, silver deposit between the repo rate to maintain a tight balance. In the afternoon, the reverse repo rate of the Treasury bonds expanded once, the highest GC001 was 7.75%, the highest GC002 was 7.6%; the highest R-001 was 7.4% in the afternoon, and the highest R-001 was 7.7%. To maintain the inter-bank market funds face tight balance, the repo rate were mixed. Traders said, near the end of the month, big investment limited, non bank institutions borrowing more difficult, in addition to the open market this week more than trillion and MLF reverse repurchase expires, the market mentality is poor.
Open market, the central bank for 70 billion and 7 days, 30 billion and 14 days, 50 billion and 63 days reverse repurchase operation, the day of 110 billion reverse repo expires, net invested 40 billion. Over half a trillion reverse repo and MLF expire this week. Wind information statistics show that this week the central bank open market has 800 billion reverse repurchase expires, which expires on Monday to Friday, 220 billion, 240 billion, 140 billion, 110 billion, 90 billion; no repo and central ticket expires, in addition, there are 207 billion MLF due on Friday.
CICC fixed income in the latest public report said that the current market sentiment is very fragile, rising concerns about economic growth and inflation expectations, funds face renewed concerns about financial supervision, strengthen the expected again, U.S. bond yields higher, many factors promoted the domestic bond interest rates upward.
China Merchants Securities believes that the bond market continued to slump China four main reasons. From a fundamental point of view, the domestic economy has toughness, difficult to shift monetary policy. From the point of view of liquidity, market liquidity easing is expected to fall.  During the nineteen major periods, financial supervision has been mentioned many times, which is the main driving force of the recent fluctuations in the bond market. After the market, the expectation that the financial supervision policy will continue to fall by the end of the year nineteen will suddenly increase. From a global perspective, global monetary policy become more conservative.
CRE bonds, interest rates jumped, the market ignored the short period of economic downturn during the long period of economic improvement, supervision of the possibility of further tightening, inflation rises sharply next year may be the central bank in December, Chinese follow the Fed rate hike open market interest rates may rise again. The bad factors have been clear are not out to make financial regulatory policy in the future will be introduced; the government on economic growth focus on quality rather than quantity, monetary policy can be more flexible, does not need to maintain growth easily relax; bond market adjustment will continue for years, yields continued the upward trend has been confirmed, before the market does not appear, do not give hunters.