Credit Spread Performance - In May, the supply of credit bonds decreased, leading to a general decline in credit spreads, with lower-rated credit bonds experiencing a more significant narrowing [1] - The AAA-rated industrial bonds saw a uniform narrowing of credit spreads across all sectors, with the real estate sector showing the largest reduction of 18.98 basis points, while the financial holding sector had the smallest reduction of 2.36 basis points [8][9] - For private placement bonds, the pharmaceutical and biological sector had the largest narrowing of 17.18 basis points, while the environmental protection sector had the smallest at 0.99 basis points [8][9] City Investment Bonds - In May, credit spreads for city investment bonds across major ratings and maturities all declined, with the largest narrowing observed in Qinghai province for both public and private bonds [1] - The overall trend indicates that credit spreads for city investment bonds are moving downward across various regions and issuer levels [1] Financial Bonds - The credit spreads for bank perpetual bonds and other financial instruments generally narrowed, with most varieties experiencing a decrease, although some maturity spreads widened [1] - Securities companies' subordinated bonds and insurance companies' capital replenishment bonds saw a complete decline in credit spreads during the month [1] Historical Context - By the end of May, various types of credit bonds maintained historically low credit spreads, particularly for short-duration non-financial credit bonds and short-duration financial bonds, while medium to long-term financial bonds remained at relatively high historical percentiles [1][6]

Report Industry Investment Rating No relevant content provided. Core Views - Last week, after the release of May economic data, with the year-on-year growth rate of social consumption reaching 6.4% and the estimated monthly GDP at 5.0%, and the tightening of the capital market, bond yields continued to decline, and non-active ultra-long bonds rose significantly. The trading activity of ultra-long bonds increased slightly, and the term spread remained flat while the variety spread widened [1][3][11]. - As of June 20, the spread between 30-year treasury bonds and 10-year treasury bonds was 20BP, at a historically low level. The May economic data showed resilience, with an estimated GDP growth rate of about 5.0%, a 0.1% decline from April but still higher than the annual target. With deflation risks, a decline in exports, a negative month-on-month change in housing prices, and a decrease in capital interest rates, the bond market sentiment improved. It is expected that the bond market is more likely to continue rising in the short term, but the term spread protection is limited [2]. - As of June 20, the spread between 20-year CDB bonds and 20-year treasury bonds was 4BP, at a historically extremely low level. Similar to the 30-year treasury bonds, considering the economic situation and market conditions, the bond market is expected to rise in the short term, but the variety spread protection is limited [3]. Summary by Directory Weekly Review Ultra-long Bond Review - After the release of May economic data, with the year-on-year growth rate of social consumption reaching 6.4% and the estimated monthly GDP at 5.0%, and the tightening of the capital market, bond yields continued to decline, and non-active ultra-long bonds rose significantly. The trading activity of ultra-long bonds increased slightly and was quite active. The term spread remained flat, and the variety spread widened [1][11]. Ultra-long Bond Investment Outlook - **30-year Treasury Bonds**: As of June 20, the spread between 30-year and 10-year treasury bonds was 20BP, at a historically low level. The May economic data showed resilience, with an estimated GDP growth rate of about 5.0%, a 0.1% decline from April but still higher than the annual target. With deflation risks, a decline in exports, a negative month-on-month change in housing prices, and a decrease in capital interest rates, the bond market sentiment improved. It is expected that the bond market is more likely to continue rising in the short term, but the term spread protection is limited [2][12]. - **20-year CDB Bonds**: As of June 20, the spread between 20-year CDB bonds and 20-year treasury bonds was 4BP, at a historically extremely low level. Similar to the 30-year treasury bonds, considering the economic situation and market conditions, the bond market is expected to rise in the short term, but the variety spread protection is limited [3][13]. Ultra-long Bond Basic Overview - The balance of outstanding ultra-long bonds exceeded 21.6 trillion. As of May 31, the total amount of ultra-long bonds with a remaining term of over 14 years was 216,823 billion (excluding asset-backed securities and project revenue notes), accounting for 14.4% of the total bond balance. Local government bonds and treasury bonds were the main varieties. By variety, treasury bonds accounted for 26.1%, local government bonds 67.8%, policy financial bonds 2.1%, government agency bonds 2.0%, commercial bank subordinated bonds 0.2%, corporate bonds 0.5%, enterprise bonds 0.1%, medium-term notes 1.2%, private bonds 0.0%, and directional instruments 0.0%. By remaining term, the 14 - 18-year (inclusive) category accounted for 26.7%, the 18 - 25-year (inclusive) 26.9%, the 25 - 35-year (inclusive) 40.3%, and over 35 years 6.2% [14]. Primary Market Weekly Issuance - Last week (June 16 - 20, 2025), the issuance of ultra-long bonds was relatively small, with a total issuance of 1,147 billion yuan. Compared with the week before last, the total issuance of ultra-long bonds increased significantly. By variety, treasury bonds accounted for 500 billion, local government bonds 505 billion, policy bank bonds 0 billion, government-supported agency bonds 0 billion, medium-term notes 30 billion, corporate bonds 113 billion, directional instruments 0 billion, enterprise bonds 0 billion, and bank subordinated bonds 0 billion. By term, 149 billion were issued with a term of 15 years, 684 billion with 20 years, 315 billion with 30 years, and 0 billion with 50 years [19]. This Week's Pending Issuance - The announced issuance plan for ultra-long bonds this week totals 3,663 billion. By variety, ultra-long treasury bonds account for 710 billion, ultra-long local government bonds 2,788 billion, ultra-long corporate bonds 0 billion, and ultra-long medium-term notes 165 billion [25]. Secondary Market Trading Volume - Last week, the trading of ultra-long bonds was quite active, with a trading volume of 11,298 billion, accounting for 11.0% of the total bond trading volume. By variety, the trading volume of ultra-long treasury bonds was 7,764 billion, accounting for 29.8% of the total treasury bond trading volume; ultra-long local bonds 2,799 billion, accounting for 51.4% of the total local bond trading volume; ultra-long policy financial bonds 103 billion, accounting for 0.3% of the total policy financial bond trading volume; and ultra-long government agency bonds 89 billion, accounting for 78.8% of the total government agency bond trading volume. The trading activity of ultra-long bonds increased slightly compared with the week before last, with an increase of 2,330 billion in trading volume and a 0.1% increase in the proportion. Among them, the trading volume of ultra-long treasury bonds increased by 1,474 billion, but the proportion decreased by 6.3%; the trading volume of ultra-long local bonds increased by 388 billion, and the proportion increased by 3.5%; the trading volume of ultra-long policy financial bonds decreased by 5 billion, and the proportion decreased by 0.1%; the trading volume of ultra-long government agency bonds increased by 66 billion, and the proportion increased by 66.2% [28]. Yield - After the release of May economic data, with the year-on-year growth rate of social consumption reaching 6.4% and the estimated monthly GDP at 5.0%, and the tightening of the capital market, bond yields continued to decline. For treasury bonds, the yields of 15-year, 20-year, 30-year, and 50-year bonds changed by -3BP, -5BP, -1BP, and -5BP to 1.78%, 1.87%, 1.84%, and 1.95% respectively. For CDB bonds, the yields of 15-year, 20-year, 30-year, and 50-year bonds changed by -5BP, -6BP, -1BP, and -5BP to 1.86%, 1.90%, 2.02%, and 2.19% respectively. For local bonds, the yields of 15-year, 20-year, and 30-year bonds changed by -5BP, -4BP, and -4BP to 1.98%, 2.03%, and 2.03% respectively. For railway bonds, the yields of 15-year, 20-year, and 30-year bonds changed by -5BP, -4BP, and -4BP to 1.92%, 1.95%, and 2.05% respectively. For representative individual bonds, the yield of the 30-year treasury bond active bond 24 Special Treasury Bond 06 changed by -2BP to 1.88%, and the yield of the 20-year CDB bond active bond 21 CDB 20 changed by -5BP to 1.89% [44][45]. Spread Analysis - **Term Spread**: Last week, the term spread of ultra-long bonds remained flat, and the absolute level was low. The spread between the benchmark 30-year and 10-year treasury bonds was 20BP, unchanged from the week before last, at the 4% percentile since 2010 [53]. - **Variety Spread**: Last week, the variety spread of ultra-long bonds widened, and the absolute level was low. The spread between the benchmark 20-year CDB bonds and treasury bonds was 4BP, and the spread between 20-year railway bonds and treasury bonds was 9BP, with a 0BP and 1BP change from the week before last respectively, at the 6% and 5% percentiles since 2010 [54]. 30-year Treasury Bond Futures - Last week, the main 30-year treasury bond futures contract TL2509 closed at 121.32 yuan, an increase of 0.68%. The total trading volume was 327,300 lots (5,583 lots), and the open interest was 137,700 lots (13,009 lots). The trading volume and open interest increased slightly compared with the week before last [60].

1. Report Industry Investment Rating There is no information provided regarding the industry investment rating in the given report. 2. Core Viewpoints of the Report - Despite the central bank's efforts to support the bond market, the decline in bond yields has been limited. The large maturity volume of certificates of deposit (CDs) and the relatively high pricing of CDs have restricted the downward space for long - term yields. The short - term yields are also constrained by factors such as the lack of long - term funds, the pressure of CD maturities and tax payment periods, and the limited impact of the expected restart of central bank bond purchases [1][2][10][15]. - By the end of June, the downward space for short - term yields is expected to open up. This is due to the release of cross - quarter pressure on funds, the seasonal increase in bank wealth management bond purchases in July, and the potential restart of central bank bond purchases [27][28][31]. - The bond market strategy is to focus on coupon income and seize trading opportunities in a narrow - fluctuating market. Investors can consider the allocation opportunities of CDs, credit bonds, and interest - rate bonds, and also grasp the trading opportunities of 10 - year treasury bonds within a narrow range [34][35][42]. 3. Summary According to Relevant Catalogs 3.1 Why Can't the Bullish Bond Market Rise? - **Market Situation**: In June, the central bank showed an attitude of caring for the money market, and large banks increased their purchases of short - term treasury bonds. However, the decline in bond yields was limited. The 1 - year and 10 - year treasury bond yields declined less than in the previous week. The pricing of CDs remained high, restricting the downward space for long - term yields. The 10 - year treasury bond yield fluctuated around 1.65% without a significant breakthrough [1][10][14]. - **Reasons for Limited Short - Term Yield Decline**: - **Lack of Long - Term Funds**: The central bank's operations mainly provided short - term funds, while long - term funds were not sufficient. Since March, MLF has been in a monthly net - investment state, and banks' demand for long - term liabilities has increased [15]. - **Pressure from CD Maturities and Tax Payment Periods**: Since the second week of June, the weekly maturity volume of CDs has exceeded one trillion yuan for three consecutive weeks. Coupled with the tax payment deadline on the 16th, the pressure on capital gaps is large, and the pressure may ease in the second half of the month [20]. - **Limited Impact of Expected Central Bank Bond Purchases**: Although the market is concerned about the restart of central bank bond purchases, the impact on short - term yields may be limited. The downward range of short - term yields may be between 5 - 10bp [21]. 3.2 Bond Market Strategy: Loosening May Come Later, and Assets Can Be Snatched Now - **Downward Space for Short - Term Yields Expected to Open Up at the End of June**: - **Decline in CD Yields after Cross - Quarter Pressure Release**: With the central bank's care for funds and the possible renewal of MLF at the end of June, funds are expected to cross the quarter smoothly. After the cross - quarter pressure is released, CD yields may decline naturally [27]. - **Increased Bond Purchases by Bank Wealth Management in July**: In July, bank wealth management usually enters a period of rapid scale growth. The net purchases of bank wealth management in the secondary market increase, and they prefer CDs and credit products with a maturity of less than one year, which may open up the downward space for CD yields [27]. - **Potential Restart of Central Bank Bond Purchases**: Since June, large banks have significantly increased their net purchases of short - term treasury bonds. The market expects the central bank to restart bond purchases, which may support the short - term bond market [28][31]. - **Bond Market Strategy: Focus on Coupon Income and Seize Trading Opportunities in a Narrow - Fluctuating Market**: - **Allocation Strategy**: - **CDs**: From the end of June to July, the probability of success is high. Investors can pay attention to the allocation opportunities brought by the current price increase. CDs with a yield of around 1.7% have high allocation value [34]. - **Credit Bonds**: Focus on credit - sinking opportunities within 3 years and the opportunity for a slight compression of 4 - 5 - year credit spreads in July [35]. - **Interest - Rate Bonds**: In a narrow - fluctuating market, focus on the exploration of α - type bonds, such as 5 - 7 - year old interest - rate bonds. If the short - term yields decline, the α - compression market of medium - term bonds may be better [38]. - **Trading Strategy**: The 10 - year treasury bond is expected to continue to fluctuate within a narrow range of 1.6% - 1.7%. Traders can consider entering the market when the bond market fluctuates and the long - term interest rate adjusts. When the yield approaches 1.62%, partial profit - taking is recommended [42]. 3.3 Review of the Interest - Rate Bond Market: Loose Funds and Expectations of Repurchase with Ownership Transfer Lead to a Bull - Flat Yield Curve - **Funding Situation**: The central bank's OMO continued to have a net withdrawal, but the money market was in a balanced and loose state. The weighted average price of DR001 dropped to around 1.36%, and the 1 - year CD issuance price of state - owned and joint - stock banks decreased from 1.7% to around 1.66% [9][60]. - **Primary Issuance**: The net financing of local government bonds and inter - bank CDs decreased, while the net financing of treasury bonds and policy - bank bonds increased [55]. - **Benchmark Changes**: The term spread of treasury bonds narrowed, while the term spread of China Development Bank bonds widened. The short - term yields of treasury bonds and China Development Bank bonds decreased, and the long - term yields of treasury bonds decreased while those of China Development Bank bonds increased [52].

Report Industry Investment Rating The provided content does not mention the report industry investment rating. Core Viewpoints - In the future week, the net payment scale of government bonds will decline, and the tax period will disrupt the capital market. Considering the central bank's care for the capital market and the adequacy of its toolbox, the capital market is expected to maintain a balanced and slightly loose operation [1]. - In the future week, the maturity scale of certificates of deposit (CDs) will exceed one trillion, with significant supply pressure. However, the central bank's second - round injection of medium - and long - term funds is expected to marginally relieve the issuance pressure of CDs, and CD yields may show a fluctuating downward trend [1]. - Funds have become the main buyer of interest - rate bonds, with a significant increase in net buying volume in the past week, while rural commercial banks have become the main seller [1]. Summary by Directory 1. Weekly Liquidity Tracking 1.1 Fund Review: The Central Bank Announces Another Injection of Medium - and Long - term Liquidity - In the statistical period (June 9 - 13, 2025), 7 - day reverse repurchase funds of 930.9 billion yuan matured, and the central bank injected 858.2 billion yuan of 7 - day funds, resulting in a net withdrawal of 7.27 billion yuan for the whole week, and the OMO stock decreased to 858.2 billion yuan. The central bank announced a second - round 40 - billion - yuan outright reverse repurchase operation for the next week, achieving a net injection for the whole month [10]. - During the statistical period, the spot exchange rate of the RMB against the US dollar depreciated by 1.52 basis points due to the uncertainty of US tariffs and the increasing expectation of a Fed rate cut [10]. - In terms of government bond progress, in the past week, the net financing of treasury bonds was 262.06 billion yuan, and the net financing since the beginning of the year was 3.10409 trillion yuan, completing 46.6% of the annual plan. The issuance of new local bonds was 8.372 billion yuan, and the issuance since the beginning of the year was 2.00893 trillion yuan, completing 38.6% of the annual plan, with a slowdown in the issuance speed. As of June 13, 1.68 trillion yuan of special refinancing bonds for replacing implicit debts had been issued, completing 84.2% of the annual plan [13]. - In terms of capital structure, the lending scale of state - owned and joint - stock banks increased significantly to over 4.5 trillion yuan, the lending scale of money market funds and wealth management products decreased, and the overall borrowing scale of non - banking institutions decreased slightly. The DR series declined, with overnight rates operating near the policy rate, and the spread between 7 - day rates and the policy rate narrowed to 10bp. The R series rose, and the liquidity stratification increased slightly but remained at a low level. The capital market showed a situation of "increasing volume and decreasing price" throughout the week, with a marginal tightening feeling on Thursday and Friday, and a balanced feeling for the whole week [15]. 1.2 CD Review: The Secondary - Market Interest Rate of CDs Declined Slightly, and the Demand from Core Buyers Strengthened - In the primary market, the net financing scale of inter - bank CDs was - 16.226 billion yuan in the statistical period, with a total issuance of 104.137 billion yuan and a maturity of 120.363 billion yuan. In the next three weeks, 102.164 billion, 113.781 billion, and 24.579 billion yuan of inter - bank CDs will mature respectively. The primary issuance rate decreased slightly, with an average issuance rate of 1.6744% (previous value: 1.7106%) [18]. - In the secondary market, core buyers such as funds and wealth management products continued to increase their holdings, money market funds changed from selling to buying, large - scale banks continued to reduce their holdings, city commercial banks and rural commercial banks changed from buying to selling, and insurance and other non - banking institutions and other product accounts continued to increase their holdings. The secondary - market yields of CDs fluctuated and declined slightly during the week, and the yield curve steepened slightly. The yields of 1M/3M/6M/9M/1Y CDs changed by - 1.78BP/ - 2.00BP/ - 1.50BP/ - 1.05BP/ - 0.91BP respectively [20]. 1.3 Next - Week Focus: The Central Bank's Firm Care for the Capital Market and the Marginal Relief of CD Issuance Pressure - In terms of the capital market, the May social financing data showed that the credit demand of residents and enterprises had recovered compared with April, with a weak stabilization of overall credit demand. The increase in government bond supply drove the stable growth of social financing, which is expected to support the key period of fiscal expenditure in June. After the deposit rate cut in May, the phenomenon of deposit transfer emerged, with a significant increase in non - banking deposits. The central bank announced a second - round injection of 40 billion yuan of 6 - month outright repurchase in the middle of the month. Combined with the previous 100 - billion - yuan 3 - month outright repurchase and the 120 - billion - yuan maturity this month, the net injection of outright reverse repurchases for the whole month was 20 billion yuan. The central bank's small - scale net withdrawal in open - market operations in the past two weeks also showed its care for the capital market. It is expected that the market will price a positive signal on June 16, but the amplitude will be smaller than that on June 6. In the next week, the net payment scale of government bonds will decline, and the tax period will disrupt the capital market. Considering the central bank's care and the adequacy of its toolbox, the capital market is expected to maintain a balanced and slightly loose operation [24]. - In terms of CDs, on the supply side, the net financing of CDs remained negative in the past week. The central bank's injection of medium - and long - term liquidity relieved the liability pressure of banks, and the primary - market interest rate of CDs decreased slightly. On the demand side, the demand from core buyers strengthened marginally, and the secondary - market yields of CDs fluctuated and declined slightly during the week. In the next week, the maturity scale of CDs will exceed one trillion, with significant supply pressure. However, the central bank's second - round injection of medium - and long - term funds is expected to marginally relieve the issuance pressure of CDs, and CD yields may show a fluctuating downward trend [25]. 2. Weekly Institutional Behavior Tracking Recent Considerations on Institutional Assets and Liabilities - The trends of the active bonds of 10 - year and 30 - year treasury bonds deviated significantly at times recently. The main reasons are that the supply rhythms of 10 - year and 30 - year treasury bonds were staggered in June, and the weak sentiment in the primary - market allocation disturbed the secondary - market. Since the beginning of the second quarter, interest rates have mainly fluctuated within a narrow range, and institutions had a strong desire to increase duration to obtain excess returns during the window of loose liquidity at the beginning of June. The trading volume of 30 - year treasury bonds increased more significantly than that of 10 - year treasury bonds. Looking forward, there will be no issuance pressure for 10 - year treasury bonds in the second half of June, and the capital price still shows certain volatility. The window period for institutions to increase duration may end, and the performance of 30 - year treasury bonds may not continue to outperform [27]. - The rotation of the bond - replacement market of China Development Bank (CDB) bonds has been very fast recently. When the bond - replacement of CDB active bonds accelerates, the volatility of new bonds will also increase. Therefore, the spread between 10 - year CDB bonds and 10 - year treasury bonds has fluctuated significantly recently. In the short term, old bonds may be safer to avoid volatility [28]. Key Review of Institutional Secondary - Market Transactions - Large - scale banks continued to buy treasury bonds with a maturity of less than 3 years, with a buying volume of about 77.6 billion yuan in the past week [31]. - Funds have become the main buyer of interest - rate bonds, with a net buying volume of about 160.4 billion yuan in the past week, showing a significant increase. Rural commercial banks have become one of the main sellers, with a net selling volume of about 109.2 billion yuan in the past week [31]. - The main buyers of CDs are money market funds, wealth management products, and other products, while the main sellers are city commercial banks and securities firms [31]. - The net buying volume of main non - banking buyers of credit bonds increased. Funds, wealth management products, and other products were the main net buyers, with funds having the largest increase. Since late March, the net buying volume of credit bonds with a maturity of less than 3 years has been generally stable, while the net buying volume of ultra - long - term credit bonds with a maturity of more than 5 years has fluctuated greatly, and the main non - banking buyers increased their buying volume significantly in the past week [31]. - For secondary - tier capital bonds, funds with a maturity of less than 2 years changed to net sellers, with a net selling volume of about 4.9 billion yuan in the past week, while wealth management products and other products changed to net buyers. The main buyers of 2 - 5 - year secondary - tier capital bonds continued to increase their buying volume, with funds having the largest net buying volume of about 36.2 billion yuan, and the banking system was the main net seller. The trading of 5 - 10 - year secondary - tier capital bonds remained light [31]. High - Frequency Data Tracking of Bond Market Micro - Structure - On June 13, the spread between 10 - year CDB bonds and 10 - year treasury bonds was 5.92bp, and the spread fluctuated and widened. The spread between 1 - year CDB bonds and R001 was 1.87BP, and the yield of short - term bonds was slightly higher than the capital price [33]. - The leverage ratio of the bond market in the week before the holiday was 107.72%, continuing to rise month - on - month [35].

Summary of Credit Bond Yield Trends in April Overall Credit Bond Performance - In April, credit bond yields exhibited a downward trend overall, with short-term spreads narrowing across the board. However, the decline in medium to long-term yields was less pronounced compared to the same maturity national development bonds, leading to a widening of credit spreads [5][9][11]. - By the end of April, short-term credit spreads remained at historically low levels, while medium to long-term financial bonds were at relatively high historical percentiles [5][11]. Industry-Specific Credit Spread Trends - **Industrial Bonds**: Most AAA-rated industrial bonds saw credit spreads widen in April. Among public bonds, the financial holding sector experienced the largest widening of 8.68 basis points, while the textile and apparel sector saw the most significant narrowing of 4.89 basis points. In private bonds, the basic chemical and retail sectors experienced slight narrowing, while other sectors generally widened by 3-10 basis points, with the steel sector widening the most at 10.86 basis points [13][15]. - **Local Government Bonds**: Credit spreads for local government bonds showed mixed trends, with lower-rated bonds generally narrowing while higher-rated bonds widened. Regions with relatively high spreads, such as Guizhou and Qinghai, mostly saw narrowing, while lower spread regions like Beijing and Shanghai experienced widening [5][9]. - **Financial Bonds**: The credit spreads for bank perpetual bonds mostly narrowed, while the spreads for securities company subordinated bonds and insurance company capital replenishment bonds widened across the board [5][9]. Historical Context - The credit spreads for various types of bonds remained at historically low levels, with AA-rated public and private industrial bonds reaching 30%-50% of their historical percentiles. Financial bonds generally had higher spread levels, exceeding the 30% historical percentile [11][12]. Key Industry Observations - In April, the steel and coal industries saw credit spreads widen across the board, with changes not exceeding 7 basis points. The high-grade bonds in these sectors experienced more significant widening. The electricity and construction engineering sectors also saw most spreads widen [15][16].

Report Industry Investment Rating No investment rating for the industry is provided in the report. Report's Core View - Fundamental factors are unlikely to break the narrow - range fluctuation pattern of the bond market. The decline in deposit rates is a short - term positive for non - bank allocation demand. The bond market is reasonably priced compared to credit and other broad - spectrum interest rates, but has a lower cost - performance ratio compared to the stock market. Chinese bonds are a global interest - rate low - lying area. In the short term, continue to focus on non - bank allocation, PMI data, and bond supply. The judgment that the 10 - year Treasury bond will fluctuate in the range of 1.5% - 1.8% remains unchanged. [6] - In terms of operations, continue to recommend 3 - and 5 - year credit bonds and Tier 2 capital bonds, and seek opportunities for spread compression through short - end credit downgrading and long - end high - grade bonds. Long - term and ultra - long - term interest - rate bonds are more suitable for trading than allocation, and continue to buy on dips. The cost - performance ratio of the previously recommended ultra - long local bonds has slightly weakened, while that of policy - financial bonds has slightly increased. [6] Summary by Relevant Catalogs This Week's Strategy View: Looking for Opportunities along the Bond Market Pricing System - Last week, the funding situation was stable. Economic data was released, and the cuts in deposit rates and LPR were implemented. The auction result of the 50 - year Treasury bond was poor, and yields fluctuated within a narrow range. Throughout the week, the yield of the active 10 - year Treasury bond rose 1BP to 1.69% compared to the previous week, the 10 - year CDB bond yield fell 1BP to 1.74%, and the 30 - year Treasury bond yield remained unchanged at 1.92%. The 10 - 1 - year term spread widened, and credit spreads remained largely unchanged. [10] - The bond market has been in a narrow - range fluctuation pattern since the suspension of Sino - US tariffs. Last week's deposit - rate cut failed to break the bond - market equilibrium. Currently, investors generally believe that the bond market has a high probability of winning but a low odds ratio. The report explores bond - market pricing from multiple dimensions. [11] Comparison with Credit and Other Broad - Spectrum Interest Rates - The pricing of the bond market is basically reasonable. There is a transmission between bonds and deposits/loans through the price - comparison effect and institutional behavior. After the recent LPR cut, some banks maintained the original 3% mortgage rate for new mortgages. If 3% is the bottom line for mortgage rates, the 30 - year Treasury bond rate may have also bottomed out. Currently, the 30 - year Treasury bond is 2BP higher than the after - tax mortgage rate, with limited upside. [12][13] - In practice, three factors prevent a simple comparison between bonds and loans: different availability of the two types of assets, the influence of non - bank trading desks not being considered, and banks' asset - allocation decisions being affected by multiple factors other than just returns. The cut in deposit rates directly benefits non - bank bond allocation. In the future, banks will face increased difficulty in liability management. [14][15] Comparison with Overseas Markets - Chinese bonds have become a global interest - rate low - lying area, but the short - term adjustment risk is limited. Recently, the sharp rise in US and Japanese bond yields has attracted global attention. The root causes are the reshaping of the global financial order, high debt levels, tight monetary policies, and large - scale long - bond auctions. [2] - China's interest rates are at a global low, especially at the ultra - long end. However, there is no need to worry about Chinese bond yields rising in tandem with overseas markets in the short term, as the influence of overseas interest rates on the Chinese bond market is limited. In the process of global capital reallocation, Chinese bonds and stocks may be relatively beneficiary assets. In the long run (2 - 3 years), there are concerns about the repricing of term spreads. [2][22][26] Comparison with the Stock Market - The bond market has a lower cost - performance ratio compared to the stock market. Currently, the dividend yields of the CSI 300, the dividend index, and the Hang Seng High - Dividend Index are approximately 3.4%, 6.7%, and 8% respectively. Considering the tax - exemption effect of insurance investments in Hong Kong stocks, their value far exceeds that of investing in ultra - long bonds. [3] - In the past two years, the imbalance in the cost - performance ratio between stocks and bonds has persisted. The core reason is that stocks carry price - fluctuation risks while offering high dividends. If the stock market can maintain an upward - trending and less - volatile pattern, there is a possibility of bond - market funds gradually flowing into the stock market to achieve a balance between stocks and bonds. [3] Comparison of Spreads among Bond Market Varieties - Regarding the pricing model of policy rates → funds → short - end → long - end, currently, the role of the MLF policy rate has diminished, and OMO is the most important pricing anchor in the bond market. However, the current term spreads are relatively flat, making it difficult to price long - term and ultra - long - term bonds according to historical rules. In the future, it is difficult for the yield - curve shape to steepen trendily, and investors should focus on finding relative opportunities. [31][32] - In terms of credit spreads, in the context of debt resolution and stricter urban - investment supervision in recent years, the "scarcity of credit assets" has become more prominent. Credit spreads still have room for compression. Specifically, avoid 1 - year ordinary credit bonds for now; 3 - 5 - year credit spreads still offer good value, and high - grade (AAA) credit spreads over 5 years are relatively attractive. Currently, inter - bank certificates of deposit have a better cost - performance ratio than short - term credit bonds, but there may be supply - demand disturbances at certain times. [33][34] - The spreads among bond varieties have significantly compressed. Low - liquidity policy - financial bonds have a slightly better cost - performance ratio, while the cost - performance ratio of local bonds has slightly weakened. [40] This Week's Operation Suggestions - Currently, the bond - market pricing is reasonable compared to credit and other broad - spectrum interest rates, but has a lower cost - performance ratio compared to overseas markets and the stock market. The fundamentals are still in a state of differentiation and bottom - grinding. The decline in deposit rates is positive for non - bank allocation demand. The long - term trend of the bond market has not reversed, but the trading space is limited, and it remains in a narrow - range fluctuation pattern in the short term. [42] - The market lacks major catalysts, so only short - term information such as funds and institutional behavior can be traded. This week, pay attention to PMI and credit - demand data, which are expected to be relatively strong and slightly negative for bonds. In terms of funds, as this week enters the end - of - month trading period, the funding center may rise slightly, but the central bank is expected to provide active support. In terms of institutional behavior, the deposit - rate cut last week led to an increase in inter - bank certificates of deposit and increased subscriptions of funds by wealth - management products, indicating that deposit migration is occurring, providing real - world support for bond - market allocation demand. [42] - In the medium term, the decline in broad - spectrum interest rates will have a certain impact on the bond market. The low of the 10 - year Treasury bond this year is expected to be around 1.5%, but it may be difficult to break through in the second quarter. The upper limit is expected to be between 1.7% - 1.8%. Therefore, if there is further adjustment from the current level, consider entering the market for allocation. [42] - In terms of operations, continue to recommend 3 - and 5 - year credit bonds and Tier 2 capital bonds, and seek opportunities for spread compression through short - end credit downgrading and long - end high - grade bonds. The narrow - range fluctuation pattern of long - term and ultra - long - term interest - rate bonds remains unchanged, so continue to buy on dips. The cost - performance ratio of the previously recommended ultra - long local bonds has slightly weakened, while that of policy - financial bonds has slightly increased. Inter - bank certificates of deposit are initially in the allocation range, but may fluctuate at relatively high levels due to liability - side disturbances. [44] This Week's Core Focus This week, focus on China's industrial - enterprise profits in April, the official manufacturing PMI in May, the euro - zone economic sentiment index in May, the Fed's monetary - policy meeting minutes in May, the US PCE in April, and the end - of - month funding situation. [45]

1. Investment Rating of the Reported Industry There is no information provided regarding the industry investment rating in the given content. 2. Core Views of the Report - The bond market is in a stalemate and under slight pressure, with ultra - long bonds rising first and then falling. The trading activity of ultra - long bonds decreased slightly last week, but it was still quite active. The term spread of ultra - long bonds narrowed, and the variety spread showed mixed trends [1][4][11]. - For the 30 - year treasury bond, as of May 23, the spread between the 30 - year and 10 - year treasury bonds was 17BP, at a historically low level. With the weakening of policy support, the probability of a decline in bond yields is higher, but the term spread protection is limited [2][12]. - For the 20 - year CDB bond, as of May 23, the spread between the 20 - year CDB bond and the 20 - year treasury bond was 2BP, at a historically extremely low level. With the weakening of policy support, the probability of a decline in bond yields is higher, but the variety spread protection is limited [3][13]. 3. Summary According to the Directory 3.1 Weekly Review 3.1.1 Ultra - long Bond Review - Last week, important events included the release of April economic data (the domestic economy declined significantly compared to March but continued to develop positively), a 500 - billion MLF operation in May with a 10BP cut in LPR after half a year, balanced funds during the tax period, and a relatively high winning bid rate for the new 10 - year treasury bond on Friday, which put slight pressure on the bond market. Overall, the bond market was in a stalemate and under slight pressure, with ultra - long bonds rising first and then falling. The trading activity of ultra - long bonds decreased slightly but remained quite active. The term spread of ultra - long bonds narrowed, and the variety spread showed mixed trends [1][4][11]. 3.1.2 Ultra - long Bond Investment Outlook - **30 - year Treasury Bond**: As of May 23, the spread between the 30 - year and 10 - year treasury bonds was 17BP, at a historically low level. The April economic data showed resilience, with the estimated GDP growth rate of about 4.1% year - on - year, a 0.8% decline from March but still higher than the annual target. The CPI in April was - 0.1% and PPI was - 2.7%, indicating obvious deflation risks. With the recent easing of Sino - US trade frictions, investors' pessimistic expectations have dissipated. The short - term focus will return to the second - quarter domestic economic data. It is expected that with the weakening of policy support, the probability of a decline in bond yields is higher, but the term spread protection is limited [2][12]. - **20 - year CDB Bond**: As of May 23, the spread between the 20 - year CDB bond and the 20 - year treasury bond was 2BP, at a historically extremely low level. Similar to the 30 - year treasury bond situation, with the weakening of policy support, the probability of a decline in bond yields is higher, but the variety spread protection is limited [3][13]. 3.1.3 Ultra - long Bond Basic Overview - The balance of outstanding ultra - long bonds exceeded 21.1 trillion. As of April 30, the total amount of ultra - long bonds with a remaining term of more than 14 years was 21,157.7 billion (excluding asset - backed securities and project revenue notes), accounting for 14.2% of the total bond balance. Local government bonds and treasury bonds are the main varieties. By variety, treasury bonds accounted for 25.6% (5,422.3 billion), local government bonds accounted for 68.2% (14,427.6 billion), etc. By remaining term, the 30 - year variety had the highest proportion [14]. 3.2 Primary Market 3.2.1 Weekly Issuance - Last week (from May 12 to May 16, 2025), a large amount of ultra - long bonds were issued, with a total of 242.4 billion yuan. Compared with the previous week, the total issuance of ultra - long bonds increased significantly. By variety, treasury bonds accounted for 121 billion, local government bonds accounted for 106.4 billion, etc. By term, 15 - year bonds accounted for 22.9 billion, 20 - year bonds accounted for 37.2 billion, 30 - year bonds accounted for 132.2 billion, and 50 - year bonds accounted for 50 billion [19]. 3.2.2 This Week's Pending Issuance - The announced issuance plan for ultra - long bonds this week totals 111.7 billion yuan. By variety, ultra - long treasury bonds account for 0 billion, ultra - long local government bonds account for 104.9 billion, and ultra - long medium - term notes account for 6.9 billion [23]. 3.3 Secondary Market 3.3.1 Trading Volume - Last week, the trading of ultra - long bonds was quite active, with a trading volume of 861.7 billion yuan, accounting for 10.2% of the total bond trading volume. By variety, ultra - long treasury bonds accounted for 31.4% of the total treasury bond trading volume, ultra - long local bonds accounted for 49.6% of the total local bond trading volume, etc. Compared with the previous week, the trading activity of ultra - long bonds decreased slightly, with the trading volume decreasing by 43.8 billion yuan and the proportion decreasing by 0.5%. Among them, the trading volume of ultra - long treasury bonds decreased by 49.8 billion yuan, the trading volume of ultra - long local bonds increased by 3.1 billion yuan, etc. [26]. 3.3.2 Yield - Due to multiple important events last week, the bond market was in a stalemate and under slight pressure, with ultra - long bonds rising first and then falling. For treasury bonds, the yields of 15 - year, 20 - year, 30 - year, and 50 - year bonds changed by 2BP, - 1BP, 1BP, and 3BP to 1.88%, 1.98%, 1.89%, and 2.06% respectively. For CDB bonds, the yields of 15 - year, 20 - year, 30 - year, and 50 - year bonds changed by 0BP, 0BP, 1BP, and 3BP to 1.94%, 2.00%, 2.07%, and 2.30% respectively. For local bonds, the yields of 15 - year, 20 - year, and 30 - year bonds changed by 0BP, 0BP, and - 2BP to 2.08%, 2.12%, and 2.11% respectively. For railway bonds, the yields of 15 - year, 20 - year, and 30 - year bonds changed by - 3BP, - 4BP, and 0BP to 2.00%, 2.04%, and 2.13% respectively. For representative individual bonds, the yield of the 30 - year treasury bond active bond 24 Special Treasury Bond 06 changed by 1BP to 1.95%, and the yield of the 20 - year CDB bond active bond 21 CDB 20 changed by 0BP to 1.98% [33][34]. 3.3.3 Spread Analysis - **Term Spread**: Last week, the term spread of ultra - long bonds narrowed, and the absolute level was low. The spread between the 30 - year and 10 - year treasury bonds was 17BP, a change of - 3BP from the previous week, at the 1% quantile since 2010 [42]. - **Variety Spread**: Last week, the variety spread of ultra - long bonds showed mixed trends, and the absolute level was low. The spread between the 20 - year CDB bond and the treasury bond was 2BP, and the spread between the 20 - year railway bond and the treasury bond was 5BP, changing by 2BP and - 4BP respectively from the previous week, at the 4% and 2% quantiles since 2010 [46]. 3.4 30 - year Treasury Bond Futures - Last week, the main contract of the 30 - year treasury bond futures, TL2509, closed at 119.60 yuan, an increase of 0.32%. The total trading volume was 469,900 lots (a decrease of 182,500 lots), and the open interest was 129,300 lots (an increase of 6,141 lots). The trading volume decreased significantly compared with the previous week, while the open interest increased slightly [48].

【市场表现】 昨日期债延续窄幅震荡。短期看，一方面期债下跌的风险有限，当前仍处在逆周期政策周期中，资金面 持续收紧的可能性小，MLF增量续作也体现了央行对资金面的呵护，LPR与存款利率双调降，中期广谱 利率处于下行周期中；另一方面在关税压力缓释的背景下，当下央行进一步引导资金利率下行的概率也 不高，还需要观察政策后效和出口动向，目前整体或以稳为主，从期限利差的角度来看长债目前吸引力 也相对有限。短期信息空窗期，整体债市或进入震荡阶段，等待基本面指引。目前预计，短期10年期国 债利率可能在1.65%-1.7%区间波动，30年国债利率可能在1.85%-1.95%区间波动。单边策略上建议观望 为主，关注高频经济数据和资金面动态。 免责声明：本报告中的信息均来源于被广发期货有限公司认为可靠的已公开资料，但广发期货对这些信 息的准确性及完整性不作任何保证。在任何情况下，报告内容仅供参考，报告中的信息或所表达的意见 并不构成所述品种买卖的出价或询价，投资者据此投资，风险自担。本报告的最终所有权归报告的来源 机构所有，客户在接收到本报告后，应遵循报告来源机构对报告的版权规定，不得刊载或转发。 国债期货收盘涨跌不一，30年期 ...

Report Industry Investment Rating No relevant content provided. Core Viewpoints - Long - term credit bonds adjusted with interest rates, while short - term credit bond spreads significantly compressed. This week, affected by the easing of Sino - US trade tariff policies, market interest rates fluctuated upward. Credit bond trends were differentiated, with long - end yields adjusting with interest rates and medium - short - end yields falling. Credit spreads of various types of credit bonds compressed, with short - term varieties having a larger decline [2][5]. - Urban investment bond spreads declined. Spreads of urban investment bonds generally decreased this week, with different levels of decline for platforms of different external subject ratings and in different regions and administrative levels [2][9]. - Industrial bond spreads generally declined, and the spreads of mixed - ownership real estate bonds significantly compressed. Central and local state - owned real estate bond spreads decreased, mixed - ownership real estate bond spreads dropped significantly, and private real - estate bond spreads slightly increased. Spreads of coal, chemical, and steel bonds also declined [2][19]. - Secondary and perpetual bond spreads were generally stable, and their overall performance was weaker than that of ordinary credit bonds. Most yields of secondary and perpetual bonds followed the interest rate upward, with only some weakly - qualified varieties slightly falling [2][29]. - Industrial perpetual excess spreads were basically flat, and urban investment perpetual excess spreads slightly declined [2][32]. Summary by Directory 1. Long - term credit bonds adjusted with interest rates, short - term credit bond spreads significantly compressed - Market interest rates fluctuated upward. 1Y, 3Y, 5Y, 7Y, and 10Y maturity China Development Bank bond yields increased by 3BP, 3BP, 6BP, 6BP, and 5BP respectively [2][5]. - Credit bond trends were differentiated. 1Y maturity credit bond yields of all grades decreased by 3 - 6BP, 3Y maturity yields decreased by 0 - 2BP, 5Y maturity yields increased by 1 - 2BP, and 7Y and 10Y maturity yields increased by 2 - 3BP [2][5]. - Credit spreads compressed. 1Y maturity credit bond spreads of all grades decreased by 6 - 9BP, 3Y, 5Y, and 7Y maturity spreads decreased by 3 - 5BP, and 10Y maturity spreads decreased by 2BP. Rating spreads and term spreads were differentiated [2][5]. 2. Urban investment bond spreads declined - Spreads of different rating platforms declined. AAA - rated platform credit spreads decreased by 7BP, while AA+ and AA - rated platform spreads decreased by 8BP [2][9]. - Regional spreads showed different declines. In different provinces, spreads of AAA - rated platforms mostly decreased by 6 - 8BP, AA+ - rated platforms mostly decreased by 7 - 9BP, and AA - rated platforms mostly decreased by 6 - 8BP. Different regions had different decline amplitudes [9][11][12]. - Spreads of different administrative levels declined. Provincial, municipal, and district - county - level platform credit spreads decreased by 7BP, 7BP, and 8BP respectively [2][15]. 3. Industrial bond spreads generally declined, mixed - ownership real estate bond spreads significantly compressed - Real estate bond spreads varied. Central and local state - owned real estate bond spreads decreased by 6 - 7BP, mixed - ownership real estate bond spreads decreased by 104BP, and private real - estate bond spreads increased by 4BP. Spreads of some real - estate companies like Longfor and Vanke also changed [2][19]. - Spreads of other industrial bonds declined. Spreads of coal, chemical, and steel bonds decreased, with coal and chemical bonds decreasing by 7BP and steel bonds decreasing by 8BP [2][19]. 4. Secondary and perpetual bond spreads were generally stable, overall performance was weaker than that of ordinary credit bonds - Yields and spreads of different terms and grades changed. 1Y maturity secondary capital bonds and AA+ and above perpetual bonds' yields increased by 2 - 3BP, with spreads decreasing by 0 - 1BP; AA - rated perpetual bond yields decreased by 1BP, with spreads decreasing by 4BP. Similar changes occurred in 3Y and 5Y maturity bonds [2][29]. 5. Industrial perpetual excess spreads were basically flat, urban investment perpetual excess spreads slightly declined - Industrial perpetual excess spreads were stable. The AAA3Y excess spread was 11.71BP, at the 20.54% quantile since 2015, and the AAA5Y excess spread was 9.22BP, at the 9.54% quantile [2][32]. - Urban investment perpetual excess spreads declined slightly. The AAA3Y urban investment perpetual bond excess spread decreased by 0.03BP to 7.25BP, at the 3.45% quantile; the AAA5Y excess spread decreased by 0.89BP to 10.56BP, at the 9.68% quantile [2][32]. 6. Credit Spread Database Compilation Instructions - Market credit spreads and related excess spreads were calculated based on ChinaBond medium - short - term notes and perpetual bonds data, with historical quantiles starting from the beginning of 2015. Credit spreads of urban investment and industrial bonds were compiled and statistically analyzed by the R & D center of Cinda Securities, also with historical quantiles starting from 2015 [38]. - Calculation methods were provided for industrial and urban investment individual bond credit spreads, bank secondary capital bond/perpetual bond excess spreads, and industrial/urban investment perpetual bond excess spreads [38][39]. - Sample selection criteria were given, including selecting medium - term notes and public corporate bonds, excluding guaranteed and perpetual bonds, and removing bonds with remaining maturities below 0.5 years or above 5 years. Different rating types were used for different bond types [40].

双降之后，债市行情从短端开始修复，收益率曲线进入兑现阶段。长端调整幅 度较大，主要受协议签订后整体风险偏好显著修复的影响。从宏观角度看，债 市逻辑变化较大。4 月份外部冲击明显加强导致收益率下行约十个 BP 左右。5 月初降息落地后政策利率调降十个 BP，对长端定价有同等幅度的估值下行。然 而协议达成超预期，中间有三个月缓冲期，这期间可能出现强劲出口变化、国 内需求端边际强化及价格端变化，带来短期宏观趋势逻辑明显变化。 摘要 • 政策利率下调 10BP 后，长端利率面临不确定性，三个月缓冲期内出口、 需求和价格可能出现变化，导致长端利率近期或维持震荡调整，难以找到 明确主线。 • 期限利差压缩至 20BP 以下，表明长端行情变动可能性小，应关注短端修 复。降准及货币政策组合拳使得流动性乐观，资金价格中枢预计移至 1.4- 1.5 附近，或阶段性突破 1.4。 • 大规模结构性货币政策（如再贷款）超预期，央行或迎来中长期流动性投 放高峰，资金价格可能向下偏离政策利率，类似于 2020 年以来的超常规 宽松。 • 存款利率调降对银行流动性有影响，但受结构性货币政策支撑，当前流动 性略偏松。银行投放高峰期，新价格证 ...