China's 10-year bond yield drops below 2%, lowest on record, driven by weak economy and rate cut bets.

From Investing.com: 2024-12-02 03:11:32

China’s 10-year yield hits record low below 2% as weak economy and rate cut bets drive investors to bonds. Prices in bond market rally for a decade, with latest ban on preferential deposit rates keeping yields low. Despite efforts to restrain rally, appetite remains insatiable, analysts expect trend to continue.

Benchmark 10-year yields drop 5 bps to 1.9750%, lowest on record. Authorities’ attempts to curb rally prove ineffective, with investor appetite strong. Analysts foresee rally continuing into next year, driven by weak fundamentals. U.S. tariffs on China imports could further boost China rates, with central bank expected to cut policy rate by 40 bps.

Morgan Stanley strategists predict China rates will rally next year, with central bank expected to cut policy rate by 40 bps. China’s 10-year treasury futures rise 0.4% to near record highs, while 30-year treasury yield falls nearly 4 bps to 2.16%. Investors cautious on China’s growth outlook amid ongoing trade tensions.



Read more at Investing.com: China’s relentless bond rally pushes 10-year yield below 2%, lowest on record By Reuters