15.09.202503:15:19UTC+00China 10Y Yield Hits Over 5-Month High

On Monday, the yield on China's 10-year government bonds rose to approximately 1.87%, reaching its highest point since early April. This increase comes amid growing concerns about the country's vulnerable economic outlook, especially following the release of underwhelming economic data. Reports indicate that both retail sales and industrial output growth fell short of predictions in August, signaling ongoing weakness in domestic demand. Additionally, fixed-asset investment decelerated further, and the unemployment rate increased to a six-month high. The National Bureau of Statistics has recognized these risks, advocating for the comprehensive implementation of macroeconomic policies to stabilize employment, support businesses, and manage market expectations while fostering reform and innovation—a position that has contributed to the rise in long-term yields. In the meantime, investors are closely watching the US-China discussions in Spain, marking their fourth meeting in as many months, which center on national security, trade, and economic matters, including TikTok's divestment timeline and US tariff plans. Attention is now shifting to this week's decision by the People's Bank of China (PBOC), where the consensus anticipates no changes.