1. Report Industry Investment Rating - The report does not mention the industry investment rating. 2. Core View of the Report - The war since February interrupted the bond market's repair rhythm at the beginning of the year, and the soaring oil price signaled the risk of "imported inflation." There is a possibility that the domestic central bank may use "interest rate cuts" to combat inflation, which is different from overseas central banks' "interest rate hikes to fight inflation" [2][4][9]. 3. Summary According to Relevant Catalogs Impact of War on the Bond Market - The war since February interrupted the bond market's repair rhythm, and the soaring oil price prompted the market to be alert to the risk of "imported inflation." After the war broke out, domestic and foreign bond interest rates rose significantly. European and American 10Y bond interest rates generally increased by more than 40BP, and the probability of the Fed raising interest rates throughout the year was about 25% as priced by interest rate futures. The domestic bond market returned to the bear - market environment before the new year, and there was even a discussion about the possibility of monetary tightening [2][12][15]. Pricing of "Imported Inflation" in the Bond Market - The bond market's focus on "imported inflation" is on inflation itself, with the core of pricing being the slope and persistence. Based on the inflation upward speed in March, the current bond market pricing is relatively sufficient. The monthly - on - monthly increase in the average daily oil price in March was +42.8%, corresponding to a PPI monthly - on - monthly increase of 1.27%, and the year - on - year PPI in March turned positive at 1.07%. If the war lasts longer, there is still room for interest rates to rise. Even if the PPI monthly - on - monthly increase in April is 0, the base effect will cause the year - on - year PPI to accelerate to 1.47%, and the 10Y interest rate may approach the upper limit of 1.95%, about 10BP higher than the current level [4][17]. Economic Situation and Bond Market Sentiment - The "economic good start" since the beginning of the year has added confidence to bond bears. From January to February, exports accelerated, with a year - on - year growth rate of 21.8%, driving the recovery of production and manufacturing investment. The recovery of the economic cycle means that time is on the side of bond bears [5][17]. Risks of "Imported Inflation" - "Inflation trading" may overestimate the global economy's tolerance for oil prices, and the transmission pressure on China's exports cannot be underestimated. Overseas institutions predict that the oil price center may rise above $150 per barrel, which may lead to a recession risk. If the oil price soars to $150 per barrel, it may cause the global GDP to decline by 5% - 8%, and the economic recovery cycle may last 4 - 7 years. If overseas raises interest rates to deal with it, "imported inflation" is likely to turn into "imported recession" [6][18][19]. Different Monetary Policies at Home and Abroad - Overseas developed countries' monetary policies are constrained by the "inflation - employment" framework and are data - dependent. They are likely to raise interest rates to reduce inflation. China, as a developing economy, may cut interest rates when facing the trade - off between imported inflation and recession. In late March, the Chinese central bank over - renewed the MLF to keep the funds loose and stable. On March 25, the central bank over - renewed 500 billion yuan of 1 - year MLF, achieving a net investment of 50 billion yuan. After the new year, the funds' interest rate remained loose, and the DR007 center has been declining since March. The short - and long - term bond interest rate trends of China and the US are divergent [9][22].