Core Viewpoint - The liquidity environment in China has shifted from tight to loose, with the central bank conducting significant reverse repos to support the market, indicating a proactive stance on maintaining liquidity during the quarter-end period [1][12]. Market Overview - The bond market experienced fluctuations, with the 10-year and 30-year government bond yields reaching 1.83% and 2.14% respectively, before retreating as equity markets adjusted [1]. - The central bank's actions included a total of 900 billion yuan in 14-day reverse repos and maintaining MLF operations, reflecting a clear intention to support liquidity [1][12]. Bond Yield Changes - As of September 26, 2025, the yields on various maturities showed mixed movements compared to September 19, with the 1-year yield decreasing by 0.75 basis points and the 30-year yield increasing by 1.74 basis points [2][3]. - The 10-year government bond yield saw a slight decrease of 0.21 basis points, while the 30-year yield increased by 3 basis points over the same period [2][3]. Primary Market Activity - In the primary market, a total of 102 bonds were issued, amounting to 579.73 billion yuan, including 3 government bonds worth 247.53 billion yuan and 78 local government bonds totaling 196.05 billion yuan [7]. - Upcoming issuance plans for the week of September 28 to September 30 include 33 bonds, all of which are local government bonds, totaling 107.15 billion yuan [8]. International Market Context - The U.S. bond market saw yields rise, with the 10-year Treasury yield increasing by 5 basis points to 4.18%, reflecting ongoing discussions among Federal Reserve officials regarding future interest rate adjustments [9][10]. - The divergence in opinions among Federal Reserve officials regarding the path of interest rate cuts indicates a complex outlook for global monetary policy, which may impact investor sentiment in the bond markets [9][10][11]. Monetary Policy Insights - The People's Bank of China emphasized the need for a supportive monetary policy stance to ensure liquidity and stabilize the financial market, while also addressing the challenges of domestic demand and low inflation [13][17]. - The central bank's commitment to maintaining a stable yuan exchange rate and enhancing the resilience of the foreign exchange market was highlighted as a key focus area [1][17]. Institutional Perspectives - Analysts from Tianfeng Securities and Caitong Securities noted that the current monetary policy reflects a balance between stability and flexibility, with expectations of controlled liquidity pressure in the upcoming month [18][19]. - The overall sentiment in the bond market remains cautious, with suggestions for investors to adopt strategies focused on short-term bonds and high-quality credit instruments [19].

Investment Rating of the Reported Industry No information provided in the given content. Core Views of the Report - In the first three quarters of 2025, the bond market yield showed an "N"-shaped trend. Credit bond yields fluctuated similarly to government bond yields, with overall wide - range volatile upward movement. Credit spreads first narrowed and then widened slightly. Default risk continued to decline, with default entities concentrated in real - estate bonds, mainly private enterprises. The amount of credit bonds with a downgraded implied rating in the ChinaBond market increased year - on - year, while the amount of upgraded ones was lower than the same period last year [9][37][38]. Summary by Relevant Catalogs Valuation Curve: Yields Fluctuated Widely and Rose - As of September 23, 2025, the yields of 1 - year Treasury bonds, 10 - year Treasury bonds, and 10 - year China Development Bank bonds changed by 30BP, 20BP, and 30BP respectively. The yields of 3 - year AAA, 3 - year AA +, 3 - year AA, and 3 - year AA - changed by 22BP, 13BP, 8BP, and - 25BP respectively. The credit spreads of 3 - year AAA, 3 - year AA +, 3 - year AA, and 3 - year AA - narrowed by 11BP, 21BP, 26BP, and 59BP respectively. Overall, the yields of medium - short - term and long - term interest - rate bonds and most credit bonds increased, and the credit spreads of various varieties narrowed, with lower - grade and shorter - term credit spreads narrowing more. The 10 - 1 curve flattened [10]. Treasury Bond Yields Presented an "N"-shaped Trend - **January - mid - March**: At the beginning of the year, the central bank suspended Treasury bond trading and reduced open - market investment to stabilize the exchange rate. The tightened capital led to an upward trend in bond market yields. After the Two Sessions, the market adjusted its expectations, and the 10 - year Treasury bond yield reached a high of 1.90% [11][12]. - **Late March - April**: The capital became looser, and the Sino - US tariff "tug - of - war" began. The 10 - year Treasury bond yield dropped to the 1.63% - 1.67% range [16]. - **May - early July**: In early May, the central bank's RRR cut and interest rate cut, along with positive results from tariff negotiations, led to a slight increase in long - end interest - rate bond yields. In June, the central bank's reverse - repurchase operations improved the capital situation, and bond yields fluctuated downward [16]. - **Mid - July - September**: The "anti - involution" policy raised inflation expectations, the equity market strengthened, and the bond market was suppressed. Bond yields rose, but short - end yields were stable, resulting in a "bear steep" pattern [16]. Credit Spreads - Credit Spreads of All Grades First Narrowed and Then Widened - **January - mid - March**: At the beginning of January, interest - rate bonds quickly adjusted upward, and credit spreads were passively narrowed. Before the Two Sessions, the market expected an RRR cut and interest rate cut, and credit spreads widened briefly. After the Two Sessions, credit spreads narrowed rapidly again [17]. - **Late March - April**: The bond market recovered quickly, and credit spreads widened slightly [17]. - **May**: Credit spreads narrowed to the lowest point of the year due to the implementation of monetary policy tools and looser capital [17]. - **June - early July**: Short - end Treasury bond yields declined, and credit spreads first widened slightly and then narrowed [17]. - **Mid - July - September**: The bond market adjusted, and credit spreads widened slightly [17]. The Risk of Downgraded Implied Rating in the ChinaBond Market Increased - In the first three quarters of 2025, the amount of credit bonds with a downgraded implied rating in the ChinaBond market was 764.1 billion, a significant year - on - year increase. The amount of upgraded credit bonds was 358 billion, significantly lower than the same period last year. The proportion of urban investment bonds in the upgraded and downgraded samples decreased both year - on - year and quarter - on - quarter [21]. Default: Default Risk Decreased, and the Default Rate of Real - Estate Bonds Declined - In the first three quarters of 2025, there were 3 new first - time default issuers. According to the broad default definition, the default amount was 6 billion, and the default rate was 0.01%, with the annualized default rate decreasing significantly compared to previous years. Default entities were mainly concentrated in real - estate bonds, mostly private enterprises. The real - estate bond default rate was 0.2%, and the default scale and annualized default rate decreased both year - on - year and quarter - on - quarter. The private enterprise default rate was 0.5%, and the annualized default rate continued to decline quarter - on - quarter [24][31]. Recovery Rate Remained Low - In the first three quarters of 2025, defaulted bonds recovered 20.76 billion in principal. From 2014 to the present, defaulted bonds have repaid 124.7 billion in principal, and the repayment rate of overdue principal was 11.9% [34].

Group 1 - The overall funding environment in July 2025 was balanced and slightly loose, with an increase in money market trading volume and a decrease in balances, leading to a decline in most repo rates [1][2] - The People's Bank of China (PBOC) emphasized a moderately loose monetary policy to ensure liquidity remains ample, aligning social financing and money supply growth with economic growth and price level expectations [1][2] - The interbank market was active in July, with a trading volume of 231.7 trillion yuan, reflecting a month-on-month increase of 12.7% and a year-on-year increase of 15.7% [1][2] Group 2 - In July, the PBOC conducted significant open market operations, with a net injection of 468 billion yuan, including 14 trillion yuan in reverse repos and 4 trillion yuan in medium-term lending facilities (MLF) [2][3] - Major repo rates showed a mixed trend, with the overnight repo rate (DR001) rising by 1 basis point to 1.39%, while the 7-day repo rate (DR007) fell by 7 basis points to 1.53% [2][3] Group 3 - The bond market saw a total issuance of 5.29 trillion yuan in July, a decrease of 0.6% month-on-month but an increase of 27.6% year-on-year, with net financing reaching 2.31 trillion yuan, up 7.9% month-on-month and 86.6% year-on-year [4] - The yield on government bonds trended upward, with the 10-year government bond yield fluctuating between 1.64% and 1.75%, and the yield curve steepening [4][5] Group 4 - The interest rate swap curve ended its inversion, with short-term rates decreasing and long-term rates increasing, indicating a shift in market sentiment [6] - The average daily trading volume of interest rate swaps increased significantly, with a total nominal principal of 4.6 trillion yuan and a daily average of 200.9 billion yuan, reflecting a month-on-month growth of 30% [6]

Group 1: Market Overview - The bond market experienced fluctuations due to external factors, with long-term bond yields rising, indicating increased sensitivity to negative factors in the real estate and credit sectors [1] - The overall difficulty in bond market operations has increased, with investors' coupon returns being quickly eroded by rising interest rates, leading to weakened investment confidence [2] - The People's Bank of China (PBOC) is expected to focus on the timing of restarting government bond trading, particularly monitoring bond yield levels [3] Group 2: Monetary Policy and Economic Support - The focus of future monetary policy will be on implementing previously announced financial policies and ensuring their effectiveness, with a supportive stance expected to continue [1] - In terms of expanding consumption, monetary policy is anticipated to target three areas: supporting service consumption and elderly loans, broadening financing channels for consumption, and enhancing policy coordination on the demand side [1] Group 3: Company Bond ETF Performance - As of August 18, 2025, the company bond ETF (511030) has seen a slight decline of 0.11%, with a one-year cumulative increase of 1.76% [4] - The latest scale of the company bond ETF reached 22.33 billion, with recent inflows and outflows remaining balanced [5] - The company bond ETF has shown a historical profitability rate of 83.33% and a monthly profitability probability of 79.94% [6]

Group 1 - The 0-4 government bond ETF (159816) has seen a 4 basis points increase, marking its sixth consecutive rise, with the latest price at 113.89 yuan [1] - The ETF experienced a trading volume of 26.68 billion yuan, indicating active market participation with a turnover rate of 143.03% [1] - The bond market's yield trends in the first half of 2025 were influenced by tightening liquidity, risk aversion, and tariff negotiations, initially rising and then falling [1] Group 2 - The 10-year government bond yield briefly fell below 1.60% at the beginning of the year but later adjusted to around 1.90% due to central bank tightening and equity market pressures [1] - From April to June, the yield fluctuated around 1.65% as a result of ongoing tariff negotiations and a series of growth-stabilizing policies from the central bank [1] - As of the end of June, the 10-year government bond yield was reported at 1.65%, down 3 basis points from the end of 2024 [1] Group 3 - According to Shenwan Hongyuan Securities, the bond market remains in a bullish window, but the potential for profit is limited, suggesting a continuation of the strategy to exploit yield spreads in the short term [1] - Local government bonds currently offer a high cost-performance ratio, but a breakthrough in interest rates requires new catalysts such as central bank bond purchases or reductions in reserve requirements [1] Group 4 - The 0-4 government bond ETF closely tracks the CSI 0-4 year local government bond index, which includes non-directional local government bonds with a remaining maturity of 4 years or less [2] - The index is calculated using market capitalization weighting to reflect the overall performance of local government bonds within the specified maturity [2] - The 0-4 government bond ETF is the only short-duration local government bond ETF in the market, suitable for investors as a cash management tool [2]

Market Overview - The bond market showed a weak consolidation on June 24, with the long-end driving an overall pullback in the curve, leading to a decline in government bond futures across the board [1] - The interbank bond yield rose by approximately 1 basis point, with a net injection of 209.2 billion yuan in the open market, and funding rates approaching the end of the month maintained an upward trend [1] Bond Futures and Yields - Government bond futures closed lower, with the 30-year main contract down 0.27% at 120.930, the 10-year down 0.11% at 109.025, the 5-year down 0.07% at 106.185, and the 2-year down 0.02% at 102.504 [2] - Major interbank interest rate bond yields generally increased, with the 10-year government bond yield rising by 0.5 basis points to 1.645%, and the 30-year government bond yield up 1.25 basis points to 1.849% [2] International Bond Market - In North America, U.S. Treasury yields collectively fell, with the 2-year yield down 4.44 basis points to 3.855% and the 10-year yield down 2.75 basis points to 4.346% [3] - In Asia, Japanese bond yields rose, with the 10-year yield increasing by 1.5 basis points to 1.424% [3] - In the Eurozone, yields on 10-year bonds in France, Germany, Italy, and Spain all decreased, reflecting market expectations for easing policies from the European Central Bank [3] Primary Market - The Ministry of Finance reported weighted average winning yields for 91-day and 30-year government bonds at 1.2594% and 1.8477%, respectively, with bid-to-cover ratios of 2.87 and 5.37 [4] - The China Development Bank's 2-year, 5-year, and 10-year financial bonds had winning yields of 1.4541%, 1.5253%, and 1.6447%, with bid-to-cover ratios of 2.78, 3.17, and 2.43 [4] Liquidity and Funding - The central bank conducted a 7-day reverse repurchase operation of 406.5 billion yuan at a fixed rate of 1.40%, resulting in a net injection of 209.2 billion yuan for the day [5] - Short-term Shibor rates mostly rose, with the overnight rate up 0.3 basis points to 1.37% and the 7-day rate up 13.2 basis points to 1.629% [5] Institutional Insights - CITIC Securities noted that the 10-year government bond yield has recently broken below 1.65%, with long-term bonds like the 30-year and 50-year performing better, driven by institutional buying [7] - China International Capital Corporation suggested increasing allocations to 3-5 year bonds with relatively high coupons, while also considering trading opportunities in long-term bonds with good credit quality [7]

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].

Report Industry Investment Rating No relevant content provided. Report's Core View - The bond market yield is expected to challenge the previous low, but it is difficult to break through. It is recommended to stop profit when approaching the key point. Specifically, it is suggested to allocate 10-year treasury bonds around 1.65% when there is an adjustment, and stop profit appropriately when approaching the key point of 1.6%. From a static perspective, attention can be paid to the allocation value of the 20-year treasury bond yield [2][6][25]. Summary by Relevant Catalogs Bond Market Yield Expected to Challenge the Previous Low - After a long period of credit expansion, the growth rate of social financing may be gradually peaking. It is expected that the growth rate of social financing will reach the annual high of about 9.0% from July to August, and then gradually decline to about 8.3% by the end of the year. The issuance of special refinancing bonds has a significant substitution effect on new RMB loans, and there is still about 40 billion yuan of special refinancing bonds to be issued this year, and its substitution effect on credit is expected to continue for some time [6][12]. - In June this year, the central bank's support brought abundant liquidity and a decline in the short end of the bond market, which made the long-term bonds not adjust deeply, and the bond market often rushes ahead in June. Under the loose capital situation, institutions generally continue the "rushing ahead" strategy of previous years, and the inter-bank leverage ratio has been rising, reaching 108.2% as of June 17. Historical experience shows that the bond market rush - ahead market is often triggered after the cross - quarter capital pressure is released [6][18]. The Previous Low Can Be Challenged but Difficult to Break Through, and It is Recommended to Stop Profit When Approaching the Key Point - The bond market is insensitive to small changes in the fundamentals. Firstly, in the context of high - quality development, the improvement of total factor productivity has increased its contribution to economic growth, reducing the demand for financing in economic growth. Since 2020, the multiple of nominal economy supported by unit social financing has increased from about 3 times to about 4.2 times in 2024. Secondly, considering the bond market valuation, at the current relatively low absolute level, a greater valuation increase is required for the interest rate to decline, making the bond market less sensitive to general weakening of the fundamentals [6][19]. - The restart of treasury bond trading is possible, but the time is not clear, and the probability of restarting when the bond market approaches the previous low may not be high. If the central bank restarts treasury bond trading, referring to the market from December 20 to December 25 last year, the yield of 1 - year treasury bonds can break through 1% at the lowest, which may directly drive the yield of long - term bonds to break below 1.6%, deviating from the current relatively desirable bond market yield level [6][24].

Report Industry Investment Rating No relevant content provided. Core View - Last week, the release of May inflation and export data showed persistent deflationary pressure and an accelerated decline in exports. The first meeting of the China - US economic and trade consultation mechanism was held, with tariffs remaining at the level of the Geneva talks. The weakening economy supported a continued decline in bond yields, and ultra - long bonds rose slightly. The trading activity of ultra - long bonds increased slightly last week and was quite active. The term spread of ultra - long bonds narrowed, while the variety spread widened [1][11][37]. - For the 30 - year treasury bond, as of June 13, the spread between the 30 - year and 10 - year treasury bonds was 20BP, at a historically low level. Considering domestic economic data, the estimated year - on - year GDP growth rate in April was about 4.1%, down 0.8% from March but still higher than the annual economic growth target. In May, CPI was - 0.1% and PPI was - 3.1%, indicating persistent deflation risks. With the recent accelerated decline in May exports, a negative month - on - month change in domestic housing prices, and a continued decline in capital interest rates, bond market sentiment improved. It is expected that the bond market is more likely to continue rising in the short term. However, the current term spread of the 30 - year treasury bond is still low, with limited spread protection [2][12]. - For the 20 - year CDB bond, as of June 13, the spread between the 20 - year CDB bond and the 20 - year treasury bond was 4BP, at a historically extremely low level. Considering domestic economic data, the estimated year - on - year GDP growth rate in April was about 4.1%, down 0.8% from March but still higher than the annual economic growth target. In May, CPI was - 0.1% and PPI was - 3.1%, indicating persistent deflation risks. With the recent accelerated decline in May exports, a negative month - on - month change in domestic housing prices, and a continued decline in capital interest rates, bond market sentiment improved. It is expected that the bond market is more likely to continue rising in the short term. However, the current variety spread of the 20 - year CDB bond is still low, with limited spread protection [3][13]. Summary by Relevant Catalogs 1. Super - long Bond Review - Last week, due to the release of May inflation and export data showing deflationary pressure and an accelerated decline in exports, along with the China - US economic and trade consultation mechanism meeting and stable tariffs, the weak economy led to a decline in bond yields, and ultra - long bonds rose slightly. The trading activity of ultra - long bonds increased slightly and was quite active. The term spread of ultra - long bonds narrowed, and the variety spread widened [1][11]. 2. Super - long Bond Investment Outlook - **30 - year Treasury Bond**: As of June 13, the 30 - 10 - year treasury bond spread was 20BP, at a low historical level. April's economy showed resilience with an estimated GDP growth of 4.1% year - on - year, down 0.8% from March but above the annual target. May's CPI was - 0.1% and PPI was - 3.1%, with deflation risks. With export decline, negative housing price growth, and falling capital rates, the bond market is likely to rise in the short term, but the term spread protection is limited [2][12]. - **20 - year CDB Bond**: As of June 13, the 20 - year CDB - treasury bond spread was 4BP, at an extremely low historical level. April's economy showed resilience with an estimated GDP growth of 4.1% year - on - year, down 0.8% from March but above the annual target. May's CPI was - 0.1% and PPI was - 3.1%, with deflation risks. With export decline, negative housing price growth, and falling capital rates, the bond market is likely to rise in the short term, but the variety spread protection is limited [3][13]. 3. Super - long Bond Basic Overview - As of May 31, the balance of super - long bonds exceeded 21.6 trillion yuan, accounting for 14.4% of the total bond balance. Local government bonds and treasury bonds are the main varieties. By variety, treasury bonds account for 26.1%, local government bonds 67.8%, etc. By remaining term, the 30 - year variety has the highest proportion [14]. 4. Primary Market - **Weekly Issuance**: Last week (June 9 - 13, 2025), 641 billion yuan of ultra - long bonds were issued, a significant decrease compared to the previous week. By variety, local government bonds were 306 billion yuan, government - supported institutional bonds 50 billion yuan, etc. By term, 15 - year bonds were 359 billion yuan, 20 - year bonds 32 billion yuan, and 30 - year bonds 250 billion yuan [19]. - **This Week's Pending Issuance**: The announced issuance plan for this week is 1029 billion yuan, including 500 billion yuan of ultra - long treasury bonds, 449 billion yuan of ultra - long local government bonds, and 80 billion yuan of ultra - long corporate bonds [24]. 5. Secondary Market - **Trading Volume**: Last week, ultra - long bonds were actively traded, with a turnover of 8968 billion yuan, accounting for 10.9% of the total bond turnover. By variety, ultra - long treasury bonds had a turnover of 6290 billion yuan, ultra - long local bonds 2411 billion yuan, etc. The trading activity increased slightly compared to the previous week [26][27]. - **Yield**: Due to economic factors, bond yields declined last week. For treasury bonds, 15 - year, 20 - year, 30 - year, and 50 - year yields changed by - 3BP, - 4BP, - 3BP, and - 3BP respectively. Similar changes occurred in CDB bonds, local bonds, and railway bonds [37]. - **Spread Analysis**: - **Term Spread**: The term spread of ultra - long bonds narrowed last week, with an absolute low level. The 30 - 10 - year treasury bond spread was 20BP, down 2BP from the previous week, at the 4% percentile since 2010 [44]. - **Variety Spread**: The variety spread of ultra - long bonds widened last week, with an absolute low level. The 20 - year CDB - treasury bond spread was 4BP, and the 20 - year railway - treasury bond spread was 8BP, up 3BP from the previous week, at the 6% and 5% percentiles since 2010 respectively [49]. 6. 30 - year Treasury Bond Futures - Last week, the main 30 - year treasury bond futures contract TL2509 closed at 120.50 yuan, an increase of 0.60%. The total trading volume was 321,700 lots (36,864 lots), and the open interest was 124,600 lots (6,864 lots). Both trading volume and open interest increased slightly compared to the previous week [52].

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].