Report Summary 1. Report Industry Investment Rating No industry investment rating is provided in the report. 2. Core Viewpoints - Last week, affected by the repeated Sino - US trade frictions, the bond market sentiment recovered. The first half of the week saw weak fluctuations in the bond market due to trade news, while the second half strengthened with the stock market decline and increased risk - aversion. Long - term bond yields rose slightly, and the yield curve flattened further as short - term yields rose more significantly [3]. - This week, the bond market will continue the high - volatility and oscillating trend. Although the bond market environment is expected to improve marginally due to increased economic pressure, potential policy easing, and reduced government bond supply in Q4, the current loose market expectations are weak, and there are still negative factors such as the unimplemented public fund sales fee regulations and upcoming events affecting risk preferences. The 10 - year Treasury bond yield is expected to range between 1.70% - 1.80% [3]. 3. Summary by Directory 3.1 Last Week's Market Review - **Secondary Market**: The bond market recovered last week. The 10 - year Treasury bond futures main contract rose 0.31% in the whole week. However, the 10 - year Treasury bond yield rose 0.40bp and the 1 - year yield rose 7.43bp compared to the previous Friday, with the term spread continuing to narrow. The daily performance of the bond market was affected by factors such as stock market movements, trade frictions, and market sentiment [4]. - **Primary Market**: 47 interest - rate bonds were issued last week, 38 less than the previous week. The issuance volume was 450.7 billion yuan, 90.5 billion more, and the net financing was 20.2 billion yuan, 223.7 billion less. The issuance of Treasury bonds and policy - financial bonds increased, while local bonds decreased. The net financing of policy - financial bonds increased, while that of Treasury and local bonds decreased. The overall subscription demand for interest - rate bonds was acceptable [11]. 3.2 Last Week's Important Events - **Foreign Trade**: In September 2025, exports increased by 8.3% year - on - year, and imports increased by 7.4%. The high growth in exports was due to a low base last year, more working days, and strong external demand for some products. However, exports may decline in the future due to US high - tariff policies, and imports may enter negative growth [13]. - **CPI and PPI**: In September, CPI decreased by 0.3% year - on - year, with a seasonal increase in the month - on - month rate. PPI decreased by 2.3% year - on - year, with the decline narrowing mainly due to a lower base last year. The domestic demand was still insufficient, and some export - oriented industries' prices were under pressure [13]. - **Financial Data**: In September, new RMB loans were 1.29 trillion yuan, and new social financing was 3.5338 trillion yuan, both less than the same period last year. M2 growth slowed to 8.4%, and M1 growth accelerated to 7.2%. The factors affecting loan and social financing growth included implicit debt replacement and weak demand [14]. 3.3 Real - Economy Observation - **Production**: High - frequency production data showed mixed performance. The semi - steel tire开工 rate increased significantly, while the asphalt plant开工 rate and daily pig iron output decreased slightly, and the blast furnace开工 rate remained unchanged [15]. - **Demand**: The BDI index continued to rise, the CCFI index continued to decline, and the commercial housing sales area in 30 large and medium - sized cities increased significantly [15]. - **Prices**: Pork prices and most commodity prices, including crude oil, rebar, and copper, declined [15]. 3.4 Last Week's Liquidity Observation - The central bank's open - market operations resulted in a net capital withdrawal of 162.36 billion yuan last week. R007 and DR007 both decreased, the share - holding bank's inter - bank certificate of deposit issuance rate increased, and the pledged repurchase trading volume increased significantly. The inter - bank market leverage ratio fluctuated greatly and decreased slightly overall [24][27][31].

Industry Investment Rating - There is no information about the industry investment rating in the provided content. Core Views - The bond market performed poorly in Q3 due to multiple factors, including policy - induced macro - narrative reversals, a decline in the bond market's profit - making effect, and regulatory - induced redemptions of bond funds. As Q4 approaches, historical experience shows that interest rates are more likely to decline in Q4. The report explores possible paths for bond market sentiment repair [6][9]. - The market has reached a consensus on a weak present but improving future for the fundamentals and continuous loosening of the capital market. Thus, poor Q4 fundamental data and loose capital cannot significantly drive down bond market interest rates [6][12]. - Central bank actions are still crucial. The deviation between the capital market and bond market interest rates is due to large government bond issuances. If the supply of interest - rate bonds increases in Q4, the central bank is expected to strengthen monetary policy. Observing changes in central bank monetary policy or a downward - guiding of inter - bank interest rates may be a path for bond market sentiment repair [6][13][16]. - Attention should be paid to the end of the withdrawal of trading funds. The bond market adjustment caused by regulatory policies on funds is more of a frictional effect. In the long run, funds are likely to return to the bond market. Monitoring regulatory rhythms, institutional responses, and the profit - taking progress of Q3 short - sellers in Q4 is advisable [6][17]. Summary by Directory 1. Bond Market Weekly View: Possible Paths for Bond Market Sentiment Repair - Q3 bond market performance was poor, affected by policies, the equity market, and regulatory factors. Institutions' behaviors changed, with insurance institutions not eager to allocate and funds having a bad experience in "bottom - fishing". Entering Q4, the report explores paths for bond market sentiment repair [9]. 2. This Week's Focus in the Fixed - Income Market: September PMI Data to be Released 2.1 Domestic PMI Data Release - This week, China will release September PMI data, and the US will release September ADP employment figures and other data [18]. 2.2 This Week's Decline in Interest - Rate Bond Issuance - The issuance scale of interest - rate bonds this week has seasonally declined to a low level, with a planned total issuance of 107.2 billion. There are no plans to issue treasury bonds and policy - financial bonds this week. 33 local bonds are planned to be issued, with a scale of 107.2 billion [21][22][23]. 3. Interest - Rate Bond Review and Outlook: High Bond Market Volatility 3.1 14 - Day Reverse Repurchase at the End of the Quarter - Near the end of the quarter, the central bank carried out 14 - day reverse repurchases. After a 30 - billion - yuan injection on Monday and no further operations in the middle of the week, a 60 - billion - yuan injection on Friday eased capital fluctuations. The net injection of open - market operations totaled 88.06 billion. Capital prices first rose and then fell. Repurchase trading volume also rose and then fell, with an average of about 7.27 trillion per week. Overnight ratios decreased. DR001 and DR007 first rose and then fell. The issuance of negotiable certificates of deposit remained at a relatively high level, with high prices. The net financing was - 17.83 billion. The 9 - month and 1 - year maturities accounted for about 44%. Secondary selling pressure was high, and last week's CD interest rates rose to a high level [27][29][35]. 3.2 Continued High Bond Market Volatility - The bond market continued to be highly volatile. At the beginning of the week, the expectation of increased monetary easing was disappointed, and multiple negative factors led to a large - scale bond market adjustment. In the second half of the week, the central bank increased the injection of medium - and long - term liquidity and 14 - day reverse repurchases, easing capital pressure and leading to bond market repair. The yields of 10Y treasury bonds and CDB active bonds changed by 0.4bp and 2bp to 1.8% and 1.96% respectively compared to last week. The yields of interest - rate bonds of various maturities mainly rose, especially those of policy - financial bonds. The 5Y Export - Import Bank bond had the largest increase, rising 4.8bp [48]. 4. High - Frequency Data: Improvement in Automobile Sales and Commodity Housing Transaction Data - On the production side, the operating rates were divided. The daily average crude steel production in early September had a year - on - year growth rate of 1.6%, turning positive from negative. - On the demand side, the year - on - year growth rates of passenger car manufacturers' wholesale and retail sales improved. The year - on - year growth rate of the commodity housing transaction area turned positive. The SCFI and CCFI composite indices changed by - 7% and - 2.9% respectively. - On the price side, crude oil prices rose, copper and aluminum prices diverged, and the settlement price of the coking coal active contract futures changed by - 0.1%. In the mid - stream, the building materials composite price index changed by 0.5%, the cement index by 2.4%, and the glass index by 3%. The output of rebar was basically flat, the inventory decreased to 4.72 million tons, and the futures price changed by - 0.6%. In the downstream consumer sector, vegetable, fruit, and pork prices changed by 2%, 1.6%, and - 0.3% respectively [55][56].