Core Viewpoint - The People's Bank of China and the Hong Kong Monetary Authority have announced several measures to optimize and expand the Bond Connect "Southbound" scheme, allowing a wider range of non-bank financial institutions to participate, which is timely given the current asset allocation challenges faced by mainland financial institutions [1][2]. Group 1: Expansion of Participation - The expansion of the "Southbound" scheme will include brokerages, insurance companies, wealth management, and asset management firms, enhancing the asset allocation capabilities of non-bank institutions [1]. - Previously, non-bank institutions primarily relied on the Qualified Domestic Institutional Investor (QDII) program, which has limitations such as scarce quotas and lengthy approval processes. The "Southbound" scheme provides a more efficient channel for investing in overseas bonds [2]. Group 2: Impact on Mainland Bond Market - The "Southbound" scheme is expected to stabilize the mainland bond market by alleviating supply shortages that have led to one-sided volatility. As of May, the bond market's custody balance reached 187.2 trillion yuan, ranking among the largest globally [2][3]. - The annual total quota for the "Southbound" scheme is set at 500 billion yuan, with a variety of options available in the Hong Kong bond market, which can provide a substitute effect for similar bond types in the mainland market [3]. Group 3: Benefits for Hong Kong Bond Market - The expansion will attract long-term funds, such as insurance capital, into the Hong Kong bond market, enhancing liquidity in the secondary market [4]. - A broader and more active investor base will create a more attractive financing environment for international investors and issuers, promoting the prosperity of the Hong Kong financial market [4]. - The diverse investment strategies and flexible trading models of non-bank institutions will significantly enhance the price discovery function and trading activity in the offshore RMB bond market, contributing to the growth of offshore RMB assets [4].

Core Viewpoint - The significant increase in the number of new bond indices in the first quarter of this year is primarily driven by favorable policies, strong market demand, and enhanced investor education [1][2][3]. Group 1: Policy Influence - A total of 335 new indices were launched by the Shanghai and Shenzhen Stock Exchanges, China Securities Index, and National Securities Index in the first quarter, representing a year-on-year increase of 69.2% [1]. - The bond index has seen a remarkable year-on-year growth of 441.67%, attributed to a series of supportive policies aimed at promoting index investment [1]. Group 2: Market Demand - The demand for bond indices is driven by their stable yield characteristics, with yields on various government bonds increasing by 41.35 basis points for 1-year bonds, 32.82 basis points for 3-year bonds, and so on, as of the end of the first quarter [2]. - Institutional investors, such as insurance companies and pension funds, are increasingly allocating to bond assets due to asset-liability management needs and a pursuit of stable returns [2]. Group 3: Investor Education - The ongoing investor education efforts have significantly improved the recognition and acceptance of bond index products among investors [3]. - The first batch of benchmark market-making credit bond ETFs attracted over 7 billion yuan in net inflows since their launch, highlighting the growing interest in bond index products [3]. Group 4: Future Outlook - The continuous increase in the number of bond indices will lead to a richer array of bond ETF products, catering to diverse investor needs [4]. - A vibrant bond ETF market will provide more quality investment options for medium- to long-term funds, enhancing market stability and resilience [4].

Group 1 - The core factors influencing the pricing strategy of urban investment bonds from a mid-term perspective (1-3 years) are government credit, regional economic fundamentals, and debt management mechanisms, while market sentiment and investor factors may also play significant roles under specific conditions [1][9][39] - Government credit, regional economic fundamentals, and debt management mechanisms are interrelated, where one can infer the others; regions with strong government credit tend to have better debt management capabilities for urban investment platforms and state-owned enterprises [1][14] - The "GDP Rise Roadmap" serves as a framework for constructing an analysis system for regional economic fundamentals, emphasizing the importance of industrial, real estate, and service sectors, along with fiscal revenue and debt ratios [2][24] Group 2 - A simplified indicator system is proposed to measure the economic fundamentals of a region, including industrial value-added, real estate development investment, and service sector performance, which can provide a more logical and efficient way to assess local economic conditions [3][28] - The debt management mechanism should be assessed through various indicators, including the "broad debt ratio" and the structure of interest-bearing debt, to understand the local government's capacity for debt control and resolution [3][30] - The mid-term factors influencing urban investment bond pricing require 1 to 3 years to gradually form a market consensus, which is essential for accurately reflecting government credit and regional economic conditions in bond valuations [39]

1. Report Industry Investment Rating - No relevant content provided. 2. Core View of the Report - In July 2025, the issuance scale of credit bonds decreased month - on - month, and the credit spreads of both urban investment bonds and industrial bonds narrowed slightly. The trading volume of urban investment bonds decreased both month - on - month and year - on - year, while that of industrial bonds increased [1][2]. 3. Summary According to the Directory 3.1 Credit Bond Issuance and Maturity 3.1.1 Credit Bond Issuance - As of the end of July 2025, the balance of outstanding credit bonds in China was 30.3 trillion yuan. From July 1 to July 31, 2025, the issuance of credit bonds was 1217.195 billion yuan, a month - on - month decrease of 7.53%, with a total repayment of 879.806 billion yuan and a net financing of 337.389 billion yuan [9]. - Urban investment bonds: As of the end of July 2025, the balance of outstanding urban investment bonds was 15.32 trillion yuan. In July 2025, the issuance was 419.407 billion yuan, a month - on - month decrease of 12.56% and a year - on - year decrease of 15.65%, with a net financing of 170.1 million yuan. Jiangsu had the highest issuance, and Qinghai and Liaoning had no issuance. Shanghai, Guangdong, and Hebei had significant issuance increases, while Hunan, Jiangsu, Shandong, and Anhui had significant decreases. Guangdong and Shanghai had large net financing, while Jiangsu and Hunan had negative net financing [10][13][15]. - Industrial bonds: As of the end of July 2025, the balance of outstanding industrial bonds was 14.98 trillion yuan. In July 2025, the issuance was 797.789 billion yuan, a month - on - month decrease of 4.54% and a year - on - year increase of 5.38%, with a net financing of 3356.88 billion yuan. Public utilities had the highest issuance and net financing [19][23]. 3.1.2 Credit Bond Maturity - Urban investment bonds: From August to December 2025, Jiangsu, Shandong, Zhejiang, and Sichuan had large maturity scales [27]. - Industrial bonds: From August to December 2025, public utilities, non - banking finance, transportation, real estate, and building decoration had large maturity scales [31]. 3.2 Credit Bond Trading and Spreads 3.2.1 Credit Bond Trading - Urban investment bonds: In July 2025, the trading volume was 1010.012 billion yuan, decreasing both month - on - month and year - on - year, with a turnover rate of 6.59% [34]. - Industrial bonds: In July 2025, the trading volume was 1699.176 billion yuan, increasing both month - on - month and year - on - year, with a turnover rate of 11.34% [36]. 3.2.2 Credit Bond Spreads - Urban investment bonds: In July 2025, the credit spreads of urban investment bonds of all levels narrowed. For AAA - rated urban investment bonds, the average spread was 45bp, narrowing by 4bp; for AA + - rated, it was 55bp, narrowing by 3bp; for AA - rated, it was 69bp, narrowing by 2bp [36]. - Industrial bonds: In July 2025, the credit spreads of industrial bonds of all levels narrowed. For AAA - rated industrial bonds, the average spread was 45bp, narrowing by 4bp; for AA + - rated, it was 67bp, narrowing by 5bp; for AA - rated, it was 70bp, narrowing by 5bp [43][44].

Report Industry Investment Rating The document does not provide the industry investment rating. Core Viewpoints - Interest rate bonds: Treasury bond yields declined, and the term spread narrowed. From July 25, 2025, to August 1, 2025, the central bank conducted a total of 2.8525 trillion yuan in reverse repurchase operations, with 2.0438 trillion yuan in reverse repurchases maturing, resulting in a net injection of 808.7 billion yuan. Inter - bank funding prices generally decreased. The 1 - year, 3 - year, 5 - year, 7 - year, and 10 - year treasury bonds decreased by 1.01BP, 3.26BP, 3.62BP, 2.02BP, and 2.65BP respectively, and the 10Y - 1Y term spread narrowed to 33.25BP [1]. - Credit bonds: The majority of credit bond yields declined. From July 28, 2025, to August 3, 2025, 610 new credit bonds were issued, with a total issuance scale of 668.086 billion yuan, a decrease of 540.715 billion yuan from the previous period. The net financing amount was 16.326 billion yuan. The issuance of asset - backed securities accounted for the largest proportion in terms of bond types. In terms of bond ratings, the issuance scale of AAA - rated bonds was 17.63 billion yuan, accounting for 62.66%. In terms of maturity, credit bond issuance was mainly concentrated in the 5 - 10 - year range. In terms of industry, the financial industry had the largest number of bond issuances. From July 25, 2025, to August 1, 2025, the majority of urban investment bond yields declined, with the 1 - year AA - rated bond having the largest decline of 6.94BP [2]. - Observation of major asset classes: From July 25, 2025, to August 1, 2025, the three major US stock indexes declined. The Dow Jones Industrial Average fell 2.92% weekly, the S&P 500 index fell 2.36% weekly, and the Nasdaq Composite fell 2.17% weekly. European and Asian - Pacific stock indexes also declined. US Treasury yields decreased, the US dollar index rose 1.04% weekly, and most non - US currencies weakened. Crude oil and gold prices rose during the week [2]. Summary by Directory 1. Interest rate bonds: Treasury bond yields declined, and the term spread narrowed 1.1. Liquidity observation: Liquidity was net - injected, and funding prices generally decreased - From July 25, 2025, to August 1, 2025, the central bank conducted a total of 2.8525 trillion yuan in reverse repurchase operations, with 2.0438 trillion yuan in reverse repurchases maturing, resulting in a net injection of 808.7 billion yuan. Inter - bank and exchange - market funding prices generally decreased [14]. 1.2. Primary market issuance: Net financing increased, and local government bond issuance decreased - From July 28, 2025, to August 3, 2025, the primary market for interest rate bonds issued 672.435 billion yuan, with a total repayment of 119.178 billion yuan for matured bonds, and a net financing amount of 553.257 billion yuan. The issuance of local government bonds decreased compared to the previous period [24]. 1.3. Secondary market trading: Treasury bond yields declined, and the term spread narrowed - From July 25, 2025, to August 1, 2025, the yields of 1 - year, 3 - year, 5 - year, 7 - year, and 10 - year treasury bonds decreased by 1.01BP, 3.26BP, 3.62BP, 2.02BP, and 2.65BP respectively, and the 10Y - 1Y term spread narrowed from 34.89BP to 33.25BP. The yields of 1 - year, 3 - year, 5 - year, 7 - year, and 10 - year policy - bank bonds decreased by 2.52BP, 3.50BP, 3.20BP, 3.47BP, and 4.64BP respectively, and the 10Y - 1Y term spread narrowed from 28.57BP to 26.45BP [30][31]. 2. Credit bonds: The majority of credit bond yields declined 2.1. Primary market issuance: Issuance volume decreased compared to the previous period - From July 28, 2025, to August 3, 2025, 610 new credit bonds were issued, with a total issuance scale of 668.086 billion yuan, a decrease of 540.715 billion yuan from the previous period. The net financing amount was 16.326 billion yuan. Asset - backed securities had the largest number of issuances, and medium - term notes had the highest issuance amount. In terms of bond ratings, AAA - rated bonds accounted for 62.66% of the total issuance. In terms of maturity, credit bond issuance was mainly concentrated in the 5 - 10 - year range. The financial industry had the largest number of bond issuances [42]. 2.2. Secondary market trading: The majority of credit bond yields declined - From July 25, 2025, to August 1, 2025, the majority of urban investment bond yields declined, with the 1 - year AA - rated bond having the largest decline of 6.94BP. The yields of medium - and short - term notes also decreased, with the 3 - year AA - rated note having the largest decline of 6.98BP [52]. 2.3. Review of weekly credit default events - From July 28, 2025, to August 3, 2025, there were no defaults on corporate credit bonds [54]. 3. Observation of major asset classes 3.1. European and American stock indexes declined - From July 25, 2025, to August 1, 2025, the three major US stock indexes and European and Asian - Pacific stock indexes all declined [55]. 3.2. US Treasury yields declined - From July 25, 2025, to August 1, 2025, the yields of 1 - year, 3 - year, 5 - year, 7 - year, and 10 - year US Treasury bonds decreased by 22.00BP, 19.00BP, 18.00BP, 18.00BP, and 17.00BP respectively, and the 10Y - 1Y term spread changed by 5.00BP to 36.00BP [57]. 3.3. The US dollar index strengthened, and most non - US currencies weakened - From July 25, 2025, to August 1, 2025, the US dollar index rose 1.04% weekly, and most non - US currencies weakened [59]. 3.4. Crude oil and gold prices rose during the week - From July 25, 2025, to August 1, 2025, the price of COMEX gold futures rose 0.93% weekly, and the price of London spot gold rose 0.10% weekly. The price of Brent crude oil rose 1.80% weekly, and the price of WTI crude oil rose 3.33% weekly [61][63]. 4. Investment suggestions - The recent VAT policy adjustment on the interest income of bonds such as treasury bonds may have multiple impacts on bond funds. It may compress direct returns, increase short - term market volatility, and lead to adjustments in bond - fund investment strategies. It is suggested to pay attention to the relevant allocation opportunities after the adjustment of new and old interest rate bonds, and this tax policy is conducive to guiding the optimization of the market structure and guiding funds to flow into the credit - bond market [3][65].

Core Insights - The introduction of a value-added tax on certain bonds is expected to impact the pricing of government bond futures, leading to an anticipated widening of the yield spread between new and old bonds [2][12][22] - Investors are advised to focus on the potential widening of the price spread between near-month and far-month contracts, particularly for T and TS varieties [1][26] Group 1: Impact of Tax Reinstatement - The reinstatement of the value-added tax on newly issued government bonds is likely to affect the pricing of deliverable bonds in the futures market, resulting in an expected widening of the yield spread between new and old bonds [2][12] - The after-tax yield reduction for various maturities is estimated to be in the range of 4.5 to 12 basis points [12][23] Group 2: New Bonds Eligible for Futures Delivery - New bonds that may be included in the delivery scope of government bond futures contracts are identified based on their issuance dates and remaining maturities [3][20] - Key upcoming issuances include a 30-year bond on August 22, a 10-year bond on August 22, and a 7-year bond on September 12, among others [16][18] Group 3: Price Impact on Futures Contracts - The pricing of government bond futures contracts will be influenced by whether new bonds become the cheapest-to-deliver (CTD) bonds, with expectations that new bonds will face price pressure due to increased CTD switching [4][22] - The probability of new bonds becoming CTD for T2603 and TS2603 contracts is higher, while near-month contracts are expected to be supported by older bonds [4][26]

Group 1 - The core point of the articles is the impact of the new tax on bond interest and the issuance of local government bonds, with a total of 36 billion yuan in new bonds issued on August 8 [1] - The 10-year local government bond ETF (511270) has shown strong trading activity, with a record high trading volume of 3.135 billion yuan on August 7 [1] - The ETF serves as an efficient tool for quick allocation of local bonds, benefiting from the tax exemption of older bonds and addressing liquidity issues through its trading characteristics [1] Group 2 - Experts suggest that the coupon rates for new bonds may be set at the national bond rolling 5-day average plus 5 basis points, indicating potential downward pressure on rates if the final rates are lower than this benchmark [2] - Overall, the market interest rates still have room to decline, although the supply of local bonds in the second half of the year may affect issuance rates [2] - The local bond issuance rates may experience downward pressure after the large supply factors diminish [2]

Core Viewpoint - The recent U.S. Treasury bond auctions have shown weak results, particularly the 30-year bond auction, indicating a decline in demand for government debt [1] Group 1: Auction Results - The yield on the 30-year bond auction exceeded the pre-issue yield, marking the largest tail risk spread in a year, which suggests weak demand [1] - The bid-to-cover ratio for the 30-year bond auction was 2.27, the lowest since November 2023, and significantly below the average of the last six auctions [1] - The indirect bid ratio, which reflects foreign demand, fell to 59.5%, the lowest since May and the second lowest since 2021 [1] Group 2: Domestic Demand - The direct bid ratio, indicating domestic demand, dropped to 23.03%, lower than both the previous month and the average of the last six auctions [1] - The allocation to primary dealers reached the highest level since August 2024, highlighting insufficient actual demand [1]

Core Viewpoint - The recent trading data for the ten-year government bond indicates a net selling trend, with a notable decrease in financing buy amounts over the last three trading days [1] Financing Activity - On August 7, the ten-year government bond (511260) had a financing buy amount of 0.11 billion, ranking 1232nd in the market [1] - The financing repayment amount on the same day was 0.43 billion, resulting in a net sell of 32.39 million [1] - Over the last three trading days (August 5-7), the financing buy amounts were 0.70 billion, 0.08 billion, and 0.11 billion respectively [1] Short Selling Activity - On August 7, there were no shares sold short, resulting in a net short sell of 0.00 shares [1]

最近三个交易日，5日-7日，30年国债(511090)分别获融资买入3.30亿元、2.09亿元、3.32亿元。 8月7日，沪深两融数据显示，30年国债(511090)获融资买入额3.32亿元，居两市第35位，当日融资偿还 额4.00亿元，净卖出6796.70万元。 融券方面，当日融券卖出0.00万股，净卖出0.00万股。 来源：金融界 ...