Report Industry Investment Rating No relevant information provided. Core Viewpoints of the Report - Since 2025, the supply in China's pig market has been generally loose, leading to a downward trend in pig prices and pushing the pig - grain ratio into the warning zone. This has weakened the profitability and cash - generating ability of breeding enterprises. Although the debt scale has continued to decline, the financial leverage of breeding enterprises remains high, and they may face short - term debt repayment pressure under the pressure of product prices. In the short term, the pig supply surplus situation is difficult to reverse quickly, and pig prices may remain volatile at a low - profit level. In 2026, the pressure of oversupply is expected to gradually ease, and pig prices may recover but still oscillate at a low - profit level [3][6][39]. - Large - scale breeding is the core trend in the pig - breeding industry. In 2025, the cost and profit gap between large - scale farms and small and medium - sized farmers narrowed, but leading enterprises still increased their market share. Enterprises with stronger cost - control capabilities will have higher competitiveness and risk - resistance [6][23][39]. Summary According to the Directory Main Concerns - **Supply - side Factors** - High - level operation of breeding capacity and improved breeding efficiency have led to an overall loose supply in the pig market since 2025. The national inventory of breeding sows has remained at around 40 million, and the PSY index has increased, further amplifying the positive impact on pig slaughter volume. From January to September 2025, the national pig inventory increased year - on - year by about 2%, and as of the end of September, it reached 436.8 million [7][8]. - Secondary fattening was an important disturbing factor in the first half of 2025. In April, the number of pigs sold to the secondary fattening channel by monitored breeding enterprises reached 59,200 per week, accounting for 33.54% of the total. After May, policy restrictions and market factors led to the concentrated slaughter of second - fattened pigs, exacerbating the supply surplus. In the second half of the year, the impact of secondary fattening decreased [10][11]. - **Demand - side Factors** - Market consumption is relatively weak. The fresh - meat sales rate of key slaughtering enterprises has been declining, and as of November 28, it dropped to 85.60%. The frozen - meat inventory may be released around the Spring Festival in 2026, and the demand increase during the peak season may not offset the supply increase [16]. - **Cost - side Factors** - From January to October 2025, the total output of industrial feed increased by 7.72% year - on - year to 279.133 million tons, and the sales of pig feed increased for 10 consecutive months. In the first half of the year, feed prices rose due to factors such as the tariff on US soybeans and the fluctuation of Brazilian soybean arrivals. In the second half of the year, feed prices declined with the new grain listing and increased soybean imports. Overall, the average feed price from January to November decreased by 4.47% year - on - year [18]. - **Pig Price Factors** - In 2025, pig prices generally declined, with the highest price of 16.54 yuan/kg in mid - January. The pig - grain ratio entered the warning zone in August. The government launched multiple rounds of central frozen - pork purchases. In the short term, pig prices may remain volatile at a low level, and in 2026, they may recover but still operate at a low - profit level [20]. Industry Development Trends - Large - scale breeding is the core trend. The proportion of large - scale pig farms (with an annual slaughter of over 500 pigs) increased from less than 40% in 2015 to over 70% in 2024. In 2025, the cost and profit gap between large - scale farms and small and medium - sized farmers narrowed, but leading enterprises still increased their market share. For example, the market share of the top three enterprises increased from 16.84% in 2024 to 19.73% in the first three quarters of 2025 [23][24]. Financial Situation of Breeding Enterprises - **Profitability** - In the first three quarters of 2025, 11 sample enterprises achieved a total operating income of 344.635 billion yuan, a year - on - year increase of 6.06%. Both the self - breeding and self - fattening model and the model of purchasing piglets for fattening were in a loss state. As of November, the loss per head was 147.99 yuan and 248.82 yuan respectively. Leading enterprises had better cost - control results, and the gap in the average period expense ratio between other enterprises and the top three enterprises widened to about 4 percentage points [29]. - **Capital Expenditure and Asset Status** - Since 2025, breeding enterprises have been cautious about capital expenditure. As of the end of September, the total fixed assets of sample enterprises decreased slightly quarter - on - quarter, and the total construction in progress decreased by 1.32% compared with the end of the previous year. The productive biological assets decreased by 9.19%, and the inventory decreased by 4.54% [34]. - **Capital Structure and Debt Situation** - By the end of September 2025, the average total debt of sample enterprises decreased by 10.55% year - on - year and 3.20% quarter - on - quarter. The average asset - liability ratio and total capitalization ratio decreased by 6.25 and 8.96 percentage points respectively. However, the short - term debt of leading enterprises was significantly higher than that of other sample enterprises, and they may face short - term debt repayment pressure [35]. - **Operating Cash Flow and Solvency** - As the pig price declined in the second quarter of 2025, the operating cash flow of most sample enterprises decreased year - on - year. The liquidity ratio of most sample enterprises improved, but the average liquidity ratio of the top three enterprises was lower than that of other sample enterprises. The ability of monetary funds to cover short - term debt weakened, but the ability of operating cash flow to cover total debt increased [37].

Key Insights - The report indicates a slight increase in credit bond issuance, with a total issuance of 1.53 trillion yuan in November, up by 217.79 billion yuan from the previous month, and a net financing increase of 170.24 billion yuan to 387.49 billion yuan [4][39] - The overall bond market is expected to continue its oscillating pattern due to a combination of economic fundamentals, policy expectations, and institutional behaviors, with a focus on maintaining a neutral duration strategy and enhancing portfolio flexibility [4][9][12] - The macroeconomic environment shows signs of pressure, with fixed asset investment growth declining by 2.6% and retail sales growth decreasing by 1.6 percentage points to 1.3% [7][9] Market Review - In November, the rolling default rate in the bond market was 0.20%, with one new default from the real estate sector, specifically from Aoyuan Group, which faced liquidity issues [16][18] - The manufacturing PMI slightly improved to 49.2, indicating a still-contractionary environment, while the central bank's liquidity operations net withdrew 375.9 billion yuan [25][30] - The secondary market saw a general increase in bond yields, with 10-year government bond yields rising by 4 basis points to 1.84% [8][39] Credit Risk and Issuance - The report highlights that credit risk remains manageable, with a total of 118 high-yield bonds issued in November, amounting to 52.84 billion yuan, and a significant increase in trading volume [5][39] - The issuance costs for credit bonds generally decreased, with rates falling between 4 to 22 basis points across various types [39][42] - The report notes that the credit spread for medium-term notes widened, particularly for 1-3 year maturities, while 5-year maturities saw a narrowing of spreads [24][39] Regional and Sectoral Insights - The report indicates that Beijing had the highest credit bond issuance at 492.4 billion yuan, with Guangdong and Shanghai also showing significant issuance [44][46] - The infrastructure financing sector saw a total issuance of 347.6 billion yuan, while the financial sector had the highest net inflow of 142.4 billion yuan [43][46] - The average issuance rates varied by industry, with the information technology sector experiencing a notable increase of 93 basis points, while the cultural industry saw a decrease of 69 basis points [43][46]

1. Report Industry Investment Rating No relevant information provided. 2. Core View of the Report - The recent adjustment in the bond market is likely to be more of a short - term phenomenon, mainly influenced by policy expectations, sentiment, and supply - demand factors in the short term. In the long run, the bond market logic will return to the fundamentals and the capital situation. - In 2026, the core operating range of the 10 - year Treasury bond yield may be between 1.7% - 1.9%, and it may maintain low - level fluctuations. Credit spreads may continue to narrow slightly, but the contraction amplitude may be limited [5][22][24]. 3. Summary by Directory Market Performance - **Interest - rate bonds**: Since November, the yield curve has become steeper, with the adjustment pressure concentrated on the long - end. The 10 - year and 30 - year Treasury bond yields have fluctuated upward, with the 30 - year yield rising more significantly. The 1 - year yield has been relatively stable. The amplitude of 1 - year, 10 - year, and 30 - year Treasury bonds since November has been 6bp, 8bp, and 14bp respectively, and the key term spreads have expanded [5][8]. - **Credit bonds**: The adjustment of credit bonds has been relatively lagging, and credit spreads have slightly widened passively. The credit bond yields first fluctuated upward, with medium - and high - grade yields rising more, and then all grades of yields declined to varying degrees. Credit bonds have recovered faster. As of December 22, the AA - grade bond yield has decreased by 9bp compared to early November, and the interest rates of higher - grade 3 - year medium - and short - term notes are similar to those at the beginning of November. Most credit spreads have widened passively, and they are still at historically low levels [5][11]. Adjustment Reasons - **Weak sentiment**: Before important policy meetings, the market entered an observation period, and there was uncertainty about policies such as next year's fiscal strength. The central bank's insufficient liquidity injection and the real - estate enterprise credit event also disturbed market sentiment [5][14]. - **Cautious institutional behavior**: Near the end of the year, under external constraints such as assessment pressure and regulatory policies, institutions' redemption and profit - taking intentions increased, and the willingness to buy was insufficient. The expectation of public - fund fee reform also led to bond - fund position adjustment and selling [5][16]. - **Supply - demand imbalance**: The supply of long - term bonds has increased while the demand has decreased. The supply of medium - and long - term Treasury bonds has increased, especially the supply of ultra - long - term Treasury bonds, while the ability of banks, insurance companies, and other institutions to absorb them is limited, and the demand from funds and other trading players has declined [5][18]. - **Insensitive to economic data**: The market has been insensitive to weak economic data, and the fundamentals have not dominated the recent interest - rate trend. The economic data has continued to show weak recovery, but the market has anticipated it in advance, and the inflation rebound has also suppressed sentiment [5][20]. Future Outlook - **Interest - rate bonds**: In 2026, the macro - policy will maintain a supportive tone of "loose money + loose finance". The weak economic recovery and abundant liquidity environment do not support a significant upward trend in bond yields. The 10 - year Treasury bond yield may operate in the range of 1.7% - 1.9%, but it may fluctuate due to challenges in demand and institutional behavior. Uncertain factors such as continued weakening of the fundamentals, intensified geopolitical evolution, and the implementation of fund - fee reform need to be vigilant [22][23][24]. - **Credit bonds**: Under the moderately loose monetary policy and the "asset shortage" situation, credit spreads may continue to narrow slightly, but considering that they are already at historically low levels, the contraction amplitude may be limited [25].

Group 1 - The credit bond market is expected to experience moderate growth in issuance, with a projected net financing scale of 1.8 to 2.3 trillion yuan and total issuance between 16.9 to 17.4 trillion yuan in 2026, reflecting a year-on-year increase of approximately 3% to 6% [4] - The issuance of industrial bonds has been robust, with a total issuance of 8.13 trillion yuan from January to November 2025, representing a year-on-year increase of 14.52%, while the net financing scale reached 2.05 trillion yuan, up 52.24% [16] - The issuance of innovative bond varieties has significantly expanded, with a total issuance of 30.24 trillion yuan from January to November 2025, an increase of 122.1 billion yuan year-on-year, driven by the establishment of the "Technology Board" [22][23] Group 2 - The secondary market for credit bonds has shown steady trading activity, with total bond transactions reaching 384.89 trillion yuan from January to November 2025, a 0.91% increase from the previous year [33] - Credit spreads have narrowed to historical lows, with the spreads for various grades of bonds generally decreasing by 3 to 74 basis points compared to the beginning of the year, indicating a tightening of credit risk premiums [42] - The yield on credit bonds has exhibited an "M-shaped" fluctuation pattern, with yields remaining at relatively low levels, particularly for AAA-rated short-term notes, which are below the 25th percentile since 2014 [36][40]

Investment Rating - The report does not explicitly provide an investment rating for the local government debt and urban investment industry. Core Insights - The report emphasizes the ongoing high-pressure regulatory environment regarding hidden debt and the need to prevent "risks from risk disposal" [3][6] - It highlights the significant progress in the use of the 500 billion yuan balance limit, with over 90% utilization [4][17] - The report notes that the audit report revealed issues in the local government debt sector, including illegal borrowing and misreporting of expenditures, amounting to 132.6 billion yuan [7][9] Summary by Relevant Sections Local Government Debt and Urban Investment Debt Trading Situation - The issuance of local government bonds decreased, with a total issuance of 24 bonds amounting to 40.037 billion yuan, a year-on-year decline [17] - The net financing amount also fell to 28.074 billion yuan, with a cumulative issuance of new bonds reaching 53,316.52 billion yuan, exceeding the annual limit by 2.53% [17] - Urban investment bonds saw a decrease in issuance scale but an increase in net financing, with 124 bonds issued totaling 78.427 billion yuan [21] Audit Report Insights - The audit report indicated that since March 2023, new hidden debt behaviors have continued, totaling 5.909 billion yuan, with significant amounts used for repaying principal and interest [8][9] - The report outlines that 9 provinces have rectified issues involving 64.75 billion yuan, with specific measures taken to improve the management of special bonds [6][7] Measures Taken by Local Governments - Gansu Province has implemented measures to mitigate debt risks, including adjusting repayment plans and reducing interest rates, saving 140 million yuan in financial costs [10][11] - A total of 7 urban investment enterprises have declared themselves as market-oriented entities or exited the financing platform, with a focus on infrastructure investment [12] Market Dynamics - The report notes that the average issuance rate for urban investment bonds has increased to 2.30%, with a widening of the issuance spread [21][22] - The trading volume for local government bonds was 450.066 billion yuan, reflecting a decrease of 9.35% from the previous period [28]

Economic Insights - The IMF warns Kenya and Ethiopia about the risks of converting SGR loans from USD to RMB, highlighting potential currency risks despite cost savings[7] - Japan's central bank raised interest rates by 25 basis points to 0.75%, the highest level in 30 years, due to rising inflation pressures[10] - Australia's inflation rose to 3.8% in October, prompting the central bank to maintain interest rates at 3.6%[11] - Iran's economy has been in recession for 20 consecutive months, with a PMI of 46.6 indicating ongoing economic contraction[12][13] Fiscal Developments - Indonesia plans to impose a 1% to 5% export tax on coal starting in 2026, aiming to generate approximately 20 trillion IDR (about 1.2 billion USD) in additional revenue[17] - South Africa's economic outlook is improving, with GDP growth expectations raised for the second half of 2025, following fiscal reforms initiated in 2021[18][19] Political and Social Issues - Eight countries, including Turkey and Egypt, oppose Israel's unilateral opening of the Rafah crossing, emphasizing the need for a two-way opening to support Palestinian residents[21] - Ongoing conflict between Thailand and Cambodia has resulted in significant casualties, with over 51,200 people displaced[22][23] Credit Ratings - Fitch upgraded Ivory Coast's sovereign credit rating from BB- to BB, maintaining a stable outlook due to political stability and strong economic growth projections of 6.4% to 6.6% from 2025 to 2027[40]

1. Core Views - The Central Economic Work Conference emphasized addressing local fiscal difficulties, with a focus on the "three guarantees" at the grass - roots level. It was proposed to maintain a deficit rate above 4% in 2026, with a general fiscal expenditure scale of about 15 trillion yuan. The management of local government special bonds was optimized, and the operational debts of financing platforms became the focus of debt resolution [6][9][11]. - Jilin Province announced that it had reached the standard to exit the list of key provinces for local debt. Liaoning Province aimed to build a closed - loop debt management system to promote effective debt resolution [15][16]. - This week, 8 urban investment companies declared themselves as market - oriented operating entities or exited the financing platform list. 25 urban investment companies prepaid bond principal and interest, and 1 urban investment bond was cancelled for issuance [18][22][23]. 2. News Comment Central Economic Work Conference - First, it was the first time to mention "addressing local fiscal difficulties" and ensuring the "three guarantees" at the grass - roots level. The contradiction between revenue reduction and expenditure increase was prominent, especially at the grass - roots level. It was necessary to increase transfer payments from the central government, optimize the transfer payment structure, and enhance local independent financial resources [9]. - Second, the positive fiscal policy was continued, with a focus on both total force and structural optimization. It was recommended that the deficit rate in 2026 be maintained above 4%, the general fiscal expenditure scale be about 15 trillion yuan, and the total scale of new government debt be increased to 14.8 - 15.5 trillion yuan. The structure of fiscal expenditure should be optimized [10][11]. - Third, the management of the use of local government special bonds was optimized, and the efficiency and quality of the "negative list" management were improved. Attention should be paid to the quality and comprehensive benefits of investment [12]. - Fourth, the operational debts of financing platforms became the focus of debt resolution. It was necessary to classify and handle debts, optimize debt restructuring and replacement methods, and establish a risk - sharing mechanism [13][14]. Jilin and Liaoning's Debt Management - Jilin Province announced reaching the standard to exit the list of key provinces for local debt, aiming to build a long - term government debt management mechanism and promote state - owned enterprise reform [15]. - Liaoning Province aimed to build a closed - loop debt management system, accelerate the resolution of implicit debts and the reform and transformation of financing platforms, and strictly prevent the increase of implicit debts [16]. Urban Investment Companies' "Exit from Platform" - This week, 8 urban investment companies declared themselves as market - oriented operating entities or exited the financing platform list. Since October 2023, a total of 963 companies have made such declarations, mainly in eastern provinces, with AA + as the main credit rating [18]. Prepayment and Cancellation of Urban Investment Bonds - 25 urban investment companies prepaid bond principal and interest this week, involving 26 bonds with a total scale of 31.57 billion yuan. One urban investment bond, "25 Chuanfa MTN003 (Hybrid Science and Technology Innovation Bond)", was cancelled for issuance, with a planned issuance scale of 1 billion yuan [22][23]. 3. Bond Issuance Local Government Bonds - This week, the issuance and net financing scale of local government bonds increased. The special refinancing bonds for replacing implicit debts in 2025 have been fully issued. As of December 14, the cumulative issuance of new bonds reached 5296.432 billion yuan, completing 101.85% of the annual quota. The weighted average issuance term was 12.52 years, and the weighted average issuance rate was 2.08% [24][25][26]. Urban Investment Bonds - This week, the issuance scale of urban investment bonds decreased, while the net financing scale increased. The issuance rate and spread both increased. The overall issuance rate was 2.28%, and the issuance spread was 77.64BP. The issuance was mainly private placement bonds, with a 5 - year term as the main one, and the issuer's main credit rating was AA + [35]. 4. Bond Trading Fund Situation - This week, the central bank conducted 668.5 billion yuan of reverse repurchase operations in the open market, with 663.8 billion yuan of reverse repurchases maturing, resulting in a net investment of 4.7 billion yuan. Short - term capital interest rates mostly increased [39]. Bond Trading - The trading scale of local government bonds decreased by 2.40% to 496.486 billion yuan, and the trading scale of urban investment bonds increased by 16.79% to 316.22 billion yuan. The credit spreads of 1 - year, 3 - year, and 5 - year AA + urban investment bonds narrowed [41]. Abnormal Trading of Urban Investment Bonds - This week, 12 urban investment entities had 12 abnormal bond transactions. The number of entities, bonds, and abnormal transactions increased compared with last week [41]. 5. Important Announcements of Urban Investment Companies - This week, 76 urban investment companies announced changes in senior management, legal representatives, directors, supervisors, etc., changes in controlling shareholders and actual controllers, equity/asset transfers, and cumulative new borrowings [44].

Report Summary 1. Industry Investment Rating - No investment rating information is provided in the report. 2. Core Viewpoints - The State Council supports private investment projects to issue infrastructure REITs to broaden the financing channels for private enterprises. The "Measures" put forward 13 measures to stimulate private investment vitality and development, focusing on direct financing through equity and REITs [2][3]. - The average issuance costs of policy - backed mortgage loans and REIT - like products are relatively high, while those of personal auto loans are relatively low [5]. - In October 2025, the issuance of ABS decreased due to holiday factors, and the secondary stratification ratio of non - performing loan products remained high [6]. - The trading activity of ABS products in the secondary market declined, with significant differences in trading activity among different products [22]. 3. Summary by Directory 3.1 REITs Policy Support - The "Measures" encourage private capital to participate in infrastructure projects and support the listing of high - tech enterprises and the issuance of infrastructure REITs by private investment projects to expand financing sources [2][3]. - The NDRC will promote the expansion of infrastructure REITs to new fields. Currently, private investment projects in infrastructure REITs have less than 20% in quantity and scale, indicating significant development potential [4]. 3.2 Market Issuance Situation - **Overall Market**: In October 2025, 164 asset - securitized products were issued, with a total scale of 181.083 billion yuan, a 33% decrease from the previous period. Non - performing loan products had a high secondary stratification ratio [6]. - **Bank - to - Bank Market**: 10 products were issued, with a scale of 34.343 billion yuan. The average issuance cost of non - performing loan products was the highest, while that of personal auto loans and micro - enterprise loans was relatively low [10][11]. - **Trading Association ABN**: 49 products were issued, with a scale of 51.653 billion yuan, a 23% decrease from the previous month. The coupon rates of priority products with disclosed credit ratings ranged from 1.65% to 3.60% [17]. - **Exchange ABS**: 105 products were issued, with a scale of 95.087 billion yuan, a 42% decrease from the previous month. The credit ratings of priority products included AAAsf and AA + sf, and the coupon rates ranged from 1.65% to 3.95% [18]. 3.3 Secondary Market Situation - **Bank - to - Bank Market**: The trading volume was 1.1445 billion yuan, with a significant decline in trading activity. Personal auto loan products had the highest trading volume [23]. - **Trading Association ABN**: The trading volume was 4.6139 billion yuan, a further decrease. Small - scale loans and enterprise accounts receivable were relatively actively traded [26]. - **Exchange ABS**: The trading volume was 8.1 billion yuan, a decrease from the previous month. The Shanghai and Shenzhen Stock Exchanges had trading volumes of 6.3879 billion yuan and 1.7121 billion yuan respectively [27].

Report Summary 1. Industry Investment Rating No investment rating information is provided in the report. 2. Core Viewpoints - In 2026, the monetary policy will maintain a supportive stance with 2 - 3 potential reserve requirement ratio cuts and interest rate cuts, and the use of structural tools will be further strengthened. The issuance scale of interest - bearing bonds will be nearly 36 trillion yuan, and the 10 - year Treasury bond yield will mainly fluctuate between 1.6% - 1.9% [4][5]. - In 2025 (January - November), the monetary policy was moderately loose, the issuance of all types of interest - bearing bonds increased year - on - year, and the yield of interest - bearing bonds showed an "N" shape, with the 10 - year Treasury bond yield exceeding 1.9% at its highest [4][5]. 3. Summary by Directory 3.1 Monetary Policy and Liquidity Monitoring - **Monetary Policy Characteristics**: In 2025, due to external uncertainties and domestic issues such as weak domestic demand, the monetary policy was moderately loose. In May, a simultaneous reserve requirement ratio cut and interest rate cut occurred, and structural tools continued to play a role. Since April, the central bank has made net monthly capital injections, and in October, the central bank resumed Treasury bond trading operations [6][7]. - **Funds Rate**: The central funds rate fluctuated downward, and the spread between DR007 and R007 remained low. In the first quarter, the funds were relatively tight; in the second quarter, after the reserve requirement ratio cut and interest rate cut, the funds rate declined; from July to November, the central funds rate further declined [12]. 3.2 Interest - Bearing Bond Market Operation Characteristics - **Issuance Scale**: From January to November 2025, the issuance scale of interest - bearing bonds reached 30.66 trillion yuan, a year - on - year increase of 17.9%. The issuance of all types of interest - bearing bonds increased, and the issuance of special Treasury bonds was completed [14]. - **Yield Trend**: The yield of interest - bearing bonds showed an "N" shape. In the first half of the year, the yield declined quarter - by - quarter; in the second half, it fluctuated upward due to factors such as the increase in risk appetite. The 10 - year Treasury bond yield exceeded 1.9% at its highest [19]. 3.3 2026 Monetary Policy Outlook - The monetary policy will maintain a supportive stance. Considering the challenges faced by the economy, the policy will continue to exert force, focusing on releasing policy effectiveness and strengthening coordination with fiscal policy [26]. - There will be 2 - 3 potential reserve requirement ratio cuts and interest rate cuts in 2026. It is estimated that there will be 1 interest rate cut of 10BP in 2026, possibly in the first quarter, and 1 - 2 reserve requirement ratio cuts, likely in the middle or fourth quarter. The use of structural tools will be further strengthened [27][28]. 3.4 2026 Interest - Bearing Bond Outlook - **Issuance Scale**: In 2026, the issuance scale of interest - bearing bonds will be nearly 36 trillion yuan. The government bond supply will further increase, with the Treasury bond issuance scale reaching 17.4 trillion yuan, local bond issuance scale reaching 11.6 trillion yuan, and the policy financial bond issuance scale reaching nearly 7 trillion yuan [30][31][32]. - **Yield Trend**: In 2026, interest - bearing bonds will likely maintain low - interest - rate operation. The 10 - year Treasury bond yield will corely fluctuate between 1.7% - 1.9%, with the low point likely between 1.6% - 1.7% and the high point between 1.9% - 2.0%. However, there may be unexpected fluctuations due to internal and external uncertainties [34][35].

1. Report Industry Investment Rating No relevant information provided. 2. Core Views of the Report - The Politburo meeting in December set the tone for the macro - policies in 2026, with the economy in 2025 expected to achieve its main goals. In 2026, the economy may face challenges, and the estimated growth rate under the neutral assumption is 4.8%. Fiscal policy should be more proactive with a suggested deficit rate of 4.5% - 5% and a broad - based deficit scale exceeding 16 trillion. Monetary policy will remain moderately loose, with expected interest rate cuts and reserve requirement ratio cuts [5][8][10]. - Nearly 20 regions have issued the "15th Five - Year Plan" suggestions, focusing on constructing government debt management mechanisms, resolving hidden debts, establishing local balance sheets, and promoting the transformation of financing platforms. It is expected that over 90% of platforms will complete their exit by the end of 2026 [5][15]. - This week, 5 urban investment enterprises declared themselves as market - oriented operating entities, 23 urban investment enterprises prepaid bond principal and interest, and 2 urban investment bonds cancelled their issuance [19][22][23]. - The issuance and net financing scale of local government bonds and urban investment bonds both decreased this week. The special refinancing bonds for replacing hidden debts in 2025 have all been issued [5][24][29]. 3. Summary by Relevant Catalogs 3.1. Important News Review 3.1.1. Politburo Meeting Emphasizes Policy Coordination - The Politburo meeting in December analyzed the economic work in 2026, stating that the economy in 2025 will achieve its main goals. In 2026, more proactive fiscal and moderately loose monetary policies will be implemented, with an emphasis on policy coordination and the integration of stock and incremental policies [7][8][10]. - It is suggested that the deficit rate in 2026 be raised to 4.5% - 5%, and the broad - based deficit scale exceed 16 trillion. The monetary policy will arrange one interest rate cut and 1 - 2 reserve requirement ratio cuts, and expand the scope of special re - loans [10]. - The key economic work in 2026 includes "domestic demand - led", "people's livelihood as the top priority", and the position of "risk prevention" has dropped to the last [13]. 3.1.2. "15th Five - Year Plan" Suggestions on Local Debt Management - Nearly 20 regions have issued "15th Five - Year Plan" suggestions, focusing on four aspects: constructing government debt management mechanisms, resolving hidden debts, establishing local balance sheets, and promoting the transformation of financing platforms [15]. - Most regions aim to resolve local government debt risks, and it is expected that over 90% of platforms will complete their exit by the end of 2026 [15][17]. 3.1.3. Tracking of Urban Investment Enterprises' "Exit from Platforms" - This week, 5 urban investment enterprises declared themselves as market - oriented operating entities, with the majority being AA + rated and from prefecture - level and district - county levels [19]. 3.1.4. Prepayment of Bond Principal and Interest by Urban Investment Enterprises - This week, 23 urban investment enterprises prepaid bond principal and interest, involving 23 bonds with a total scale of 34.02 billion yuan [22]. 3.1.5. Cancellation of Urban Investment Bond Issuance - This week, 2 urban investment bonds cancelled their issuance, with a planned total issuance scale of 6 billion yuan. As of December 7, 101 urban investment bonds have postponed or cancelled their issuance this year, with a total scale of 645.28 billion yuan [23]. 3.2. Issuance of Local Government Bonds and Urban Investment Enterprise Bonds 3.2.1. Local Government Bonds - The issuance and net financing scale of local government bonds decreased this week. The special refinancing bonds for replacing hidden debts in 2025 have all been issued. The total issuance scale was 1087.17 billion yuan, and the net financing amount was 604.93 billion yuan [24]. - As of December 7, the cumulative issuance of new bonds (excluding special bonds for small and medium - sized banks) was 52253.78 billion yuan, completing 100.49% of the annual new quota [24]. 3.2.2. Urban Investment Bonds - The issuance and net financing scale of urban investment bonds decreased this week. The total issuance scale was 878.19 billion yuan, and the net financing amount was - 7.11 billion yuan [29]. - The overall issuance interest rate was 2.20%, a decrease of 1.60BP from the previous value, and the issuance spread was 70.92BP, a decrease of 0.09BP [29]. 3.3. Trading of Local Government Bonds and Urban Investment Enterprise Bonds - The central bank conducted 6638 billion yuan of reverse repurchase operations in the open market this week, with 15118 billion yuan of reverse repurchases maturing, resulting in a net withdrawal of 8480 billion yuan [33]. - The short - term capital interest rates mostly declined this week [33]. - There were no adjustments to the urban investment ratings and no urban investment credit risk events this week [33]. - The trading scale of local government bonds increased by 29.40% to 5086.82 billion yuan, and most of the maturity yields increased [35]. - The trading scale of urban investment bonds decreased by 6.61% to 2707.68 billion yuan, and most of the maturity yields increased, with an average increase of 4.05BP [35]. - There were 9 abnormal transactions of 5 bonds from 5 urban investment entities this week, with a decrease in the number of entities and bonds compared to last week [35]. 3.4. Important Announcements of Urban Investment Enterprises - This week, 51 urban investment enterprises issued announcements regarding changes in senior management, legal representatives, directors, supervisors, etc. [38].