1. Report Industry Investment Rating - No information provided in the report. 2. Core Viewpoints of the Report - This week, the yields of treasury bond cash bonds generally declined. The yields to maturity of 2 - 7Y bonds dropped by about 2 - 3bp, and the yields to maturity of 10Y and 30Y bonds decreased by about 2.9 and 3.6bp respectively to 1.80% and 2.22%. Treasury bond futures strengthened across the board, with the main contracts of TS, TF, T, and TL rising by 0.05%, 0.05%, 0.10%, and 0.58% respectively. In the short term, multiple positive factors may drive the bond market to strengthen slightly, but the market's expectations of pre - holiday reserve requirement ratio cuts and interest rate cuts have cooled, and the downward space for yields is limited. It is expected that interest rates will continue to fluctuate within a range. [9][100] 3. Summary According to the Table of Contents 3.1 Market Review - **Weekly Data**: The trading volumes of the main contracts of TS, TF, T, and TL all increased, while the open interests all decreased. The main contracts of 2 - year, 5 - year, 10 - year, and 30 - year treasury bond futures rose by 0.05%, 0.05%, 0.10%, and 0.58% respectively. [13][30] 3.2 News Review and Analysis - **Key News**: The "14th Five - Year Plan"'s first central No. 1 document was released, focusing on rural revitalization. The central bank carried out 800 billion yuan of 3 - month repurchase operations and increased the roll - over of 10 billion yuan. There were important phone calls between China and the US leaders, emphasizing issues such as the Taiwan issue. In the US, the government's partial shutdown ended, but the employment market showed weakness, with a significant increase in the number of initial jobless claims and a sharp decline in job vacancies. Iran and the US held nuclear - issue negotiations. [33][34][35] 3.3 Chart Analysis - **Price Difference Changes**: The yield spread between 10Y and 5Y and the spread between 5 - year and 10 - year main contracts widened; the yield spread between 10Y and 1Y, the spread between TF and TS main contracts, the 10 - year contract inter - period spread, and the 5 - year contract inter - period spread narrowed; the 30 - year contract inter - period spread, the 2 - year contract inter - period spread, and the spread between TF and TS main contracts fluctuated. [43][49][53] - **Treasury Bond Futures Main Position Changes**: The net short positions of the top 20 positions in the T - bond futures main contract decreased. [66] - **Interest Rate Changes**: Overnight, 1 - week, 2 - week, and 1 - month Shibor rates all declined, and the DR007 weighted average rate fell back to around 1.46% and fluctuated. The yields of treasury bond cash bonds generally declined, with the 10Y and 30Y yields to maturity falling by about 2.9 and 3.6bp respectively. The Sino - US 10 - year treasury bond yield spread narrowed, while the 30 - year treasury bond yield spread widened. [68][73] - **Central Bank Open - Market Operations**: This week, the central bank conducted 1.0055 trillion yuan of reverse repurchases in the open market, with 1.7615 trillion yuan due, and increased the roll - over of 10 billion yuan in repurchase, resulting in a net withdrawal of 65.6 billion yuan. [79] - **Bond Issuance and Maturity**: This week, the bond issuance was 169.9266 billion yuan, the total repayment was 42.3261 billion yuan, and the net financing was 127.6005 billion yuan. [83] - **Market Sentiment**: The central parity rate of the RMB against the US dollar was 6.9590, with a cumulative increase of 88 basis points this week. The spread between the RMB offshore and on - shore exchange rates narrowed. The yield of the 10 - year US treasury bond declined, and the VIX index rose significantly. The 10 - year treasury bond yield declined, and the A - share risk premium increased slightly. [89][92][97] 3.4 Market Outlook and Strategy - **Domestic Fundamentals**: In January, the prosperity levels of China's manufacturing and service industries both declined, and the manufacturing PMI returned to the contraction range, but the industrial structure continued to improve. The profits of industrial enterprises above the designated size increased year - on - year in December, and the annual profits achieved positive growth. The unexpected decline in the January PMI data indicates that the current fundamentals are still in a weak recovery state, and the endogenous driving force of the economy needs to be further boosted. [100] - **Overseas Situation**: The US employment market remains weak, with the number of job vacancies in December dropping to the lowest level since 2020 and the number of layoffs increasing slightly. The market's expectations of the Fed's interest rate cuts have cooled. [100] - **Market Outlook**: The central bank restarted the 14 - day reverse repurchase operation to maintain a loose liquidity environment. The market risk appetite has declined significantly, and some funds have flowed into the bond market. In the short term, multiple positive factors may drive the bond market to strengthen slightly, but the downward space for yields is limited, and it is expected that interest rates will continue to fluctuate within a range. [100]

Report Summary 1. Report Industry Investment Rating No information provided in the report. 2. Core Viewpoints of the Report - Amid renewed tariff conflicts, market sentiment is significantly affected by trade risks in the short term. The current fundamentals are constrained by insufficient effective demand. With external demand impacted by tariffs, the recovery of domestic demand is crucial for consolidating economic recovery. It is expected that monetary and fiscal policies will further coordinate their efforts. Recently, market risk appetite has declined due to risk aversion, and the bond market has shown an oscillatory recovery trend under the stock - bond "seesaw" effect, alleviating the previous fragile sentiment. Strategically, a band - operation approach is recommended, while closely monitoring Sino - US trade progress and policy trends such as new regulations for bond funds [97]. 3. Summary by Directory 3.1 Market Review - **Performance of Treasury Bond Futures Contracts**: This week, all treasury bond futures contracts strengthened. The 30 - year, 10 - year, 5 - year, and 2 - year main contracts (TL2512, T2512, TF2512, TS2512) rose by 1.67%, 0.29%, 0.12%, and 0.02% respectively. The trading volumes of TS and TF main contracts decreased, while those of T and TL main contracts increased. The open interests of TF, T, and TL main contracts increased, while that of the TS main contract decreased [12][15][21][29]. - **Yield of Treasury Bond Spot**: This week, the yields of short - term treasury bond spots were weak, while those of medium - and long - term ones were strong. The changes in the yields to maturity from 1 - 7Y were around - 0.2 - 1bp. The yields to maturity of 10Y and 30Y decreased by about 0.2 and 2.3bp to 1.74% and 2.07% respectively [8]. 3.2 News Review and Analysis - **Domestic News**: In September, China's exports (in US dollars) increased by 8.3% year - on - year, imports increased by 7.4% year - on - year, and the trade surplus was 904.5 billion US dollars. The central bank planned to conduct a 6000 - billion - yuan 6 - month - term repurchase operation, resulting in a net injection of 4000 billion yuan for the month. In September, China's CPI rose 0.1% month - on - month and decreased 0.3% year - on - year, with the core CPI rising 1% year - on - year. The PPI remained flat month - on - month and decreased 2.3% year - on - year. At the end of September, M2 increased by 8.4% year - on - year, and M1 increased by 7.2% year - on - year [32]. - **Overseas News**: Fed Chairman Jerome Powell hinted that the central bank might end balance - sheet reduction in the next few months. The expected deterioration of the labor market supported investors' expectations of another interest - rate cut this month. The US Treasury Secretary said that if China stopped its strict rare - earth export control plan, the US might extend the three - month exemption from additional tariffs on China. There were differences among Fed officials regarding the pace of interest - rate cuts [33]. 3.3 Chart Analysis - **Spread Changes**: This week, the spread between 10 - year and 5 - year bonds widened, while the spread between 10 - year and 1 - year bonds narrowed. The spreads between the 2 - year and 5 - year main contracts, and between the 5 - year and 10 - year main contracts widened. The spread between the current and next quarters of the 10 - year contract oscillated, and that of the 30 - year contract narrowed. The spread between the current and next quarters of the 5 - year contract narrowed, and that of the 2 - year contract widened [41][47][51][58]. - **Changes in Main Positions of Treasury Bond Futures**: The net short positions of the top 20 holders of the T main contract increased significantly [64]. - **Interest Rate Changes**: The 2 - week Shibor rate decreased, while the overnight, 1 - week, and 1 - month Shibor rates increased. The weighted average DR007 rate fell to around 1.41%. The spreads between Chinese and US 10 - year and 30 - year treasury bond yields both narrowed slightly [68][72]. - **Open - Market Operations**: This week, the central bank conducted 7894 billion yuan in reverse repurchases and had 11710 billion yuan in reverse - repurchase maturities, resulting in a net withdrawal of 3819 billion yuan. The weighted average DR007 rate fell to around 1.41% [77]. - **Bond Issuance and Maturity**: This week, the total bond issuance was 13,313.04 billion yuan, and the total repayment was 9909.84 billion yuan, with a net financing of 3404.23 billion yuan [79]. - **Market Sentiment**: The central parity rate of the US dollar against the RMB was 7.0949, with a cumulative increase of 99 basis points this week. The spread between the offshore and onshore RMB narrowed. The yield of the 10 - year US treasury bond oscillated downward, and the VIX index rose significantly. The yield of the 10 - year treasury bond in China decreased, and the A - share risk premium decreased slightly [85][88][93]. 3.4 Market Outlook and Strategy - **Domestic Fundamentals**: In September, inflation continued to recover, with the core CPI rising to 1% year - on - year driven by gold prices, and the year - on - year decline of PPI continuing to narrow. Social financing grew steadily in September, but the support of government bonds for social financing weakened. Credit growth was lower than expected, and enterprises' long - term investment willingness remained weak. Some residents' deposits flowing back promoted a significant rebound in the M1 growth rate. In September, the year - on - year growth rate of imports rebounded unexpectedly, and exports to major economies such as ASEAN and the EU continued to grow [96]. - **Overseas Situation**: The US announced plans to impose an additional 100% tariff on China, but then released multiple signals of easing. The US government remained shut down, and many key economic data were postponed. The market's expectation of the Fed's continued interest - rate cut in October remained firm [96].

Report Industry Investment Rating - No relevant content provided Core Viewpoints of the Report - The bond market has been oscillating at the bottom, with weak repair momentum. In the short term, institutional behavior, expectations of incremental policies, and changes in the capital market are the main driving factors. The "supply - strong, demand - weak" pattern may continue in August economic data, and the bond market is unlikely to trend downward significantly, with yields expected to remain in a high - level oscillation pattern. It is recommended to wait and see on a single - side basis and focus on term spread trading opportunities brought by the steepening of the yield curve [97][98] Summary by Directory 1. Market Review - **Performance of Treasury Futures Contracts**: The 30 - year TL2512 contract fell 0.41%, the 10 - year T2512 contract rose 0.12%, the 5 - year TF2512 contract rose 0.07%, and the 2 - year TS2512 contract fell 0.02%. The trading volumes of TS, TF, and T contracts increased, while that of the TL contract decreased. The open interests of all TS, TF, T, and TL contracts increased [13][17][23][31] - **Performance of Deliverable Bonds**: The prices of some deliverable bonds changed, such as the 30 - year 210005 IB falling 0.14 and the 10 - year 220017 IB rising 0.05 [13] 2. News Review and Analysis - **Domestic News**: In August, the added value of industrial enterprises above designated size increased by 5.2% year - on - year, social consumer goods retail sales reached 39668 billion yuan, a year - on - year increase of 3.4%, and fixed - asset investment (excluding rural households) decreased by 0.20% month - on - month. The urban surveyed unemployment rate was 5.3%. The Sino - US economic and trade leaders held talks and reached a basic framework consensus on some issues [34] - **Overseas News**: US retail sales in August were 732.01 billion US dollars, a month - on - month increase of 0.6%. The initial jobless claims were 231,000, a significant drop. The Fed cut the federal funds rate target range by 25 basis points to 4% - 4.25% [10][35][36] 3. Chart Analysis - **Spread Changes** - **Yield Spreads**: The spread between 10 - year and 5 - year bonds widened slightly, while the spread between 10 - year and 1 - year bonds narrowed slightly. The spreads between 2 - year and 5 - year, 5 - year and 10 - year contract main contracts widened slightly. The 10 - year and 30 - year contract inter - period spreads widened significantly, the 5 - year contract inter - period spread narrowed, and the 2 - year contract inter - period spread widened [44][48][52] - **Treasury Futures Main Position Changes**: The net short positions of the top 20 positions in the T contract increased significantly [64] - **Interest Rate Changes** - **Shibor and Treasury Yields**: Overnight, 1 - week, 2 - week, and 1 - month Shibor rates all increased. The yields of treasury bonds due in 1 - 7 years changed between - 1 and 2 basis points, and the yields of 10 - year and 30 - year bonds rose by about 0.4 and 1 basis points to 1.80% and 2.10% respectively [68] - **Sino - US Treasury Yield Spreads**: The spreads between 10 - year and 30 - year Sino - US treasury bonds widened slightly [73] - **Central Bank Open - Market Operations**: The central bank conducted 1826.8 billion yuan in reverse repurchases and 150 billion yuan in treasury cash deposits, with 1264.5 billion yuan in reverse repurchases and 120 billion yuan in treasury cash deposits maturing, resulting in a net injection of 592.3 billion yuan. The weighted average DR007 rate rebounded to around 1.50% [77] - **Bond Issuance and Maturity**: This week, bonds worth 1708.793 billion yuan were issued, with a total repayment of 1190.265 billion yuan, and a net financing of 518.528 billion yuan [81] - **Market Sentiment** - **USD/CNY Exchange Rate**: The central parity rate of the US dollar against the RMB was 7.1128, with a cumulative depreciation of 109 basis points this week. The spread between the offshore and on - shore RMB weakened [86] - **US Treasury Yields and VIX Index**: The yield of 10 - year US Treasury bonds oscillated upward, and the VIX index increased [91] - **A - Share Risk Premium**: The yield of 10 - year treasury bonds decreased, and the A - share risk premium increased slightly [94] 4. Market Outlook and Strategy - **Domestic Fundamentals**: In August, industrial growth, social retail, and export growth slowed down, fixed - asset investment continued to shrink, and the unemployment rate rose seasonally. Social financing growth declined slightly, and credit growth was weak. The economic recovery has slowed down since July, and the manufacturing PMI is still in the contraction range. Supply - demand contradictions persist, and macro - policies need to boost domestic demand [97] - **Overseas Situation**: The number of initial jobless claims in the US decreased significantly, but overall employment growth slowed down. The Fed cut interest rates by 25 basis points, and the market's expectation of a rate cut in October increased [97] - **Bond Market Outlook and Strategy**: The bond market has been oscillating at the bottom, with weak repair momentum. The "supply - strong, demand - weak" pattern may continue, and the bond market is unlikely to trend downward significantly. It is recommended to wait and see on a single - side basis and focus on term spread trading opportunities [98]