Monetary Policy Operations - The People's Bank of China conducted a 468 billion yuan 7-day reverse repurchase operation at an interest rate of 1.40%, unchanged from previous rates, resulting in a net withdrawal of 1,430 billion yuan due to 1,898 billion yuan of reverse repos maturing on the same day [1] Interbank Rates - The Shanghai Interbank Offered Rate (Shibor) for short-term instruments showed a slight decline, with overnight Shibor down by 0.10 basis points to 1.2750%, 7-day Shibor down by 0.10 basis points to 1.4280%, and 14-day Shibor down by 3.90 basis points to 1.4710% [2][3] Repo Market - In the interbank pledged repo market, overnight funding rates remained around 1.27%, with the weighted average rate for DR001 down by 0.13 basis points to 1.2731%, DR007 down by 0.65 basis points to 1.4423%, and DR014 down by 2.88 basis points to 1.4794% [4][6] Funding Conditions - The overall funding environment on December 17 was balanced and slightly loose, with overnight rates for pledged loans ranging from 1.30% to 1.40% and 7-day rates around 1.50% [9] - A total of 99 interbank certificates of deposit were issued, with an actual issuance amount of 185.56 billion yuan [9] Financial Market Developments - The financial preparations for the Hainan Free Trade Port, which will officially start its full island closure on December 18, have been completed, with the People's Bank of China supporting the construction of the port [12] - The National Financial Regulatory Administration approved Xiamen International Bank's capital increase of 2.17 billion Hong Kong dollars in Xiamen International Investment Co., Ltd. [12]

Report Summary 1. Report Industry Investment Rating No relevant information provided. 2. Core View of the Report - The report suggests focusing on the central bank's attitude. Given the continued weakness in the bond market and the potential for further decline in Treasury bond futures the next day, it is recommended to wait and see for now [1][3]. 3. Summary by Related Catalogs a. Market Performance - On Wednesday, Treasury bond futures opened and closed lower across the board. The decline of medium - and long - term varieties intensified in the afternoon, and spot bond yields rose across the board, with larger increases in the medium - and long - term. The open market had a net injection of 7.49 billion, but the capital market remained tight, with DR001 rising to around 1.43% [1]. - The prices of all contracts on the Treasury bond futures market decreased on September 10, 2025. For example, TS2512 dropped from 102.39 to 102.348, a decline of 0.042; TF2512 fell from 105.58 to 105.445, a decline of 0.135; T2512 decreased from 107.785 to 107.505, a decline of 0.28; and TL2512 dropped from 115.76 to 114.87, a decline of 0.89 [4]. - The contract positions of TS2512, T2512, and TL2512 increased, while that of TF2512 decreased. The trading volume of all main contracts increased [4]. b. Intraday News - The Ministry of Finance re - issued 5 - year Treasury bonds with a weighted winning bid rate of 1.5973% and a marginal rate of 1.6216%, and re - issued 50 - year Treasury bonds with a winning bid rate of 2.2227% [2]. - In August, China's CPI turned negative year - on - year, dropping 0.4%, while the core CPI rose to 0.9%, and the year - on - year decline of PPI narrowed to 2.9% [2]. c. Market Analysis - The bond market continued its weak performance in the morning, and the decline intensified in the afternoon as the A - share market rebounded. Although the central bank increased its injection in the open market, the capital market did not improve. The winning bid situation of the re - issued 5 - year and 50 - year Treasury bonds in the primary market was better than expected, but it did not boost the secondary market sentiment. The economic data in August had a neutral impact on the bond market [3]. - After the futures market closed, spot bond yields continued to rise, indicating that Treasury bond futures may continue to decline the next day [3].

Group 1: Investment Ratings - No information about the industry investment rating is provided in the given content. Group 2: Core Views - No clear core views are presented in the provided content. Group 3: Summary by Relevant Catalogs Futures Data - 10 - year Treasury bond futures (T2509.CFE) had a Friday settlement price of 108.325 with a -0.26% weekly decline; T2512.CFE settled at 108.225 with a -0.26% weekly decline [7]. - 5 - year Treasury bond futures (TF2509.CFE) settled at 105.675 with a -0.14% weekly decline; TF2512.CFE settled at 105.670 with a -0.19% weekly decline [7]. - 2 - year Treasury bond futures (TS2509.CFE) settled at 102.346 with a -0.02% weekly decline; TS2512.CFE settled at 102.384 with a -0.05% weekly decline [7]. - 30 - year Treasury bond futures (TL2509.CFE) settled at 117.660 with a -1.33% weekly decline; TL2512.CFE settled at 117.210 with a -1.40% weekly decline [7]. Spread Data - The T2509 - T2512 inter - delivery spread was 0.100 with no weekly change; TF2509 - TF2512 was 0.005 with a -1.143 weekly change; TS2509 - TS2512 was -0.038 with a -0.095 weekly change [7]. - The 2TS - T cross - variety spread was 301.059 with a 0.189 weekly increase; 2TF - T was 103.025 with a -0.005 weekly change; TS - TF was 99.017 with a 0.097 weekly increase [7]. Spot Bond Yields - 1Y Treasury bond yield was 1.37% with a 1.32 BP weekly increase; 2Y was 1.40% with a 0.72 BP increase; 3Y was 1.41% with a -0.65 BP decrease [7]. - 5Y Treasury bond yield was 1.59% with a 4.92 BP increase; 7Y was 1.69% with a 3.70 BP increase; 10Y was 1.75% with a 5.80 BP increase; 30Y was 2.05% with a 9.05 BP increase [7]. - 1Y China Development Bank bond yield was 1.53% with a 3.18 BP increase; 3Y was 1.66% with a 2.93 BP increase; 5Y was 1.74% with a 7.47 BP increase [7]. - 7Y China Development Bank bond yield was 1.86% with a 6.83 BP increase; 10Y was 1.86% with a 7.87 BP increase; 30Y was 2.15% with a 9.80 BP increase [7]. Funding Rates - The inter - bank pledged repo rate DROO1 was 1.40% with a 9.03 BP weekly increase; DR007 was 1.48% with a 5.47 BP increase; DR014 was 1.51% with a 3.28 BP increase [7]. - SHIBOR1M was 1.53% with a 0.04 BP increase; SHIBOR3N was 1.55% with a -0.74 BP decrease [7].