Core Viewpoint - The article discusses the recent fluctuations in government bond yields, highlighting a rebound on June 18 after a significant decline, driven by macroeconomic fundamentals and expectations of a loose monetary policy [1][2]. Market Performance - On June 18, the bond market experienced volatility, with the 30-year main contract rising by 0.09% while the 10-year main contract fell by 0.01%. The 5-year contract decreased by 0.01%, and the 2-year contract increased by 0.01% [3]. - The yields of various government bonds showed a general upward trend, with the 30-year bond yield rising by 0.15 basis points to 1.844%, and the 10-year bond yield increasing by 0.4 basis points to 1.6375% [3]. Market Sentiment and Expectations - The decline in bond yields prior to June 18 was attributed to rumors regarding the inclusion of medium and short-term government bonds in reserve requirements, which affected market sentiment [4]. - Analysts suggest that the best time for the central bank to restart government bond trading is in the second half of the year, particularly in the third quarter, with appropriate announcement procedures expected [5]. Factors Influencing the Market - The anticipation of the central bank's bond trading resumption is influenced by the large scale of bank interbank certificates maturing at the end of June, with expectations of increased short-term bond purchases by major banks [7]. - Recent data indicates that major banks have significantly increased their purchases of short-term government bonds, which has contributed to a bullish sentiment in the bond market [7]. Monetary Policy and Market Dynamics - The central bank's proactive measures, including multiple reverse repos, have helped maintain a stable funding environment, with a net injection of liquidity expected for June [8]. - Despite the positive outlook, some analysts caution that the downward space for bond yields may be limited, particularly for the 10-year bond yield, which faces resistance in the 1.5% to 1.6% range [9].

Core Viewpoint - The market is speculating on the inclusion of short- and medium-term government bonds in the reserve requirement, and there are high expectations for the central bank to restart government bond trading in the second half of the year [1][3]. Group 1: Market Reactions - On June 18, government bond yields mostly rebounded after a significant decline, driven by improved sentiment in the bond market due to macroeconomic fundamentals and expectations of loose monetary policy [2][3]. - The bond market experienced fluctuations, with the 30-year main contract rising by 0.09% and the 10-year main contract falling by 0.01% [2]. Group 2: Speculation on Policy Changes - There is ongoing debate regarding the inclusion of short-term government bonds in the reserve requirement, with uncertainty about its implementation and timing [3]. - Analysts suggest that the best window for the central bank to restart government bond trading is expected in the second half of the year, particularly in the third quarter [3][4]. Group 3: Economic and Funding Conditions - The market anticipates that the central bank will restart bond purchases due to significant upcoming maturities of interbank certificates of deposit and increased buying of short-term bonds by major banks [4][5]. - Recent actions by the central bank, including multiple announcements of reverse repos, indicate a supportive stance towards the funding environment, which has contributed to a recovery in the overall leverage in the bond market [5][6]. Group 4: Future Outlook - The sentiment in the bond market is currently optimistic, with expectations of continued support from the central bank and a potential increase in net financing of government bonds in the third quarter [4][5]. - However, some analysts caution that the space for further declines in bond yields may be limited, particularly for the 10-year government bond yield, which faces resistance in the range of 1.5% to 1.6% [5].