Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints - In 2025, under the requirement of a more proactive fiscal policy, the issuance scale of local government bonds in the first quarter reached a record high, but the issuance progress of new bonds was relatively slow. The issuance of refinancing bonds increased significantly, and nearly half of the provinces completed the issuance of this year's replacement quota. The support of special bonds for real - estate related projects increased significantly, and the proportion of special bonds used as capital decreased slightly. - It is predicted that about 7 trillion yuan of local government bonds will be issued this year, and the issuance in the second quarter is expected to accelerate, with a scale of over 3 trillion yuan. The special bonds can theoretically leverage about 4.3 trillion yuan of infrastructure investment, but the actual leverage effect needs to be improved. - In the future, attention should be paid to the issuance and use progress of government bonds, the implementation of special bonds for land reserves and the acquisition of existing commercial housing, the investment direction of special bond funds, the overall efficiency of fiscal funds, and the rigid repayment pressure of fiscal budget funds under the increasing interest - payment scale [4][36]. 3. Summary by Relevant Catalogs 3.1 First Quarter Local Bond Market Operation Features - **High - record issuance scale, high proportion of refinancing bonds, and slow progress of new bonds**: In the first quarter, local government bonds issued 2.84 trillion yuan, a year - on - year increase of 80.58%. Refinancing bonds issued 1.60 trillion yuan, a year - on - year increase of about 1.2 times, accounting for 56.39% of the local bond issuance scale. New bonds issued 1.24 trillion yuan, completing 21.82% of the quota, still lower than the average level in the past three years [4][7]. - **Nearly half of the provinces completed the issuance of this year's replacement quota, and the issuance progress of new special bonds in "self - review and self - issuance" pilot areas was fast**: By the end of the first quarter, 14 provinces completed the issuance of this year's replacement quota, and only 3 provinces had not issued special refinancing bonds. The issuance progress of new special bonds in 10 pilot provinces was significantly faster than that in non - pilot provinces [11][12]. - **Extended issuance term, over 80% of 10 - year and above bonds, and a monthly rising trend in issuance interest rates**: The weighted average issuance term of local government bonds increased by 4.49 years year - on - year to 17.19 years. The issuance interest rate decreased year - on - year but showed a monthly rising trend. The overall spread of local government bonds continued to be within 15bp, narrowing year - on - year [18][20]. - **Significantly increased support for the real - estate sector by special bonds, and a slight decrease in the proportion of special bonds used as capital**: The investment of special bonds was still concentrated in municipal and industrial parks, transportation, and other fields. The support for real - estate related projects increased significantly, and the proportion of special bonds used as capital decreased slightly [23]. 3.2 Follow - up Issuance Outlook - **Issuance forecast**: About 7 trillion yuan of local government bonds are to be issued this year. In the second quarter, the issuance of new special bonds is expected to accelerate, with a scale of 1.6 trillion yuan. Over 3 trillion yuan of refinancing bonds are to be issued, and about 0.66 trillion yuan of special refinancing bonds for implicit debt replacement are still to be issued. It is recommended to cut the reserve requirement ratio and interest rates in a timely manner [28][30]. - **Leverage effect forecast**: About 2.6 trillion yuan of new special bonds are expected to be invested in infrastructure projects this year, which can theoretically leverage about 4.3 trillion yuan of infrastructure investment. However, the actual leverage effect is limited by multiple factors [34]. 3.3 Issues to be Concerned about and Corresponding Suggestions - **Pay attention to the issuance and use progress of local government bonds**: Accelerate the issuance and use of new special bonds, advance debt replacement, and strengthen the coordination of monetary policy [37]. - **Pay attention to the implementation of special bonds for land reserves and the acquisition of existing commercial housing**: Introduce relevant policy details as soon as possible to prevent capital idling and stabilize the real - estate market [39]. - **Pay attention to the investment direction of special bond funds**: Expand the scope of use, focus on people's livelihood, consumption, and long - term development, and strengthen project reserves and financing docking in new fields [40]. - **Pay attention to the overall efficiency of fiscal funds**: Improve the supervision and early - warning system, enhance the efficiency of debt - resolution funds, and give full play to the role of other fiscal funds [42]. - **Pay attention to the rigid repayment pressure of fiscal budget funds under the increasing interest - payment scale**: Improve the debt - repayment and interest - payment guarantee mechanism [43].

Core Insights - The U.S. Treasury Department auctioned six-month Treasury bills with a winning yield of 4.235%, slightly up from 4.230% on April 29 [1] - The bid-to-cover ratio was 2.91, indicating a decrease from the previous auction's ratio of 3.14, suggesting lower demand [1]

Group 1 - The U.S. Treasury auctioned three-month Treasury bills with a winning yield of 4.220%, an increase from 4.200% on April 28 [1] - The bid-to-cover ratio for the three-month Treasury bills was 2.74, down from 3.10 in the previous auction [1] - The auction of six-month Treasury bills had a winning yield of 4.090%, up from 4.065% on April 28 [1] Group 2 - The bid-to-cover ratio for the six-month Treasury bills was 3.52, an increase from 2.80 in the previous auction [1]

Group 1 - The U.S. Treasury auctioned a four-month Treasury bill with a winning yield of 4.190%, slightly down from 4.210% reported on April 23 [1] - The bid-to-cover ratio was 3.08, indicating strong demand compared to the previous auction's ratio of 2.92 [1]

Group 1 - The U.S. Treasury will auction $58 billion in three-year notes [1] - The auction will also include $25 billion in 30-year bonds [1] - Additionally, $42 billion in ten-year notes will be offered [1]

美国财政部预计至少在未来几个季度将保持稳定的国债拍卖规模。 ...

Overall Issuance Situation - In March 2025, the issuance volume of local government bonds was 978.8 billion yuan, a decrease of 326.9 billion yuan month-on-month but an increase of 349.4 billion yuan year-on-year. The net financing amount was 879.2 billion yuan, down 393.6 billion yuan month-on-month but up 594.4 billion yuan year-on-year [3][5]. - The issuance of new special bonds remained high, with a total of 363.5 billion yuan issued in March, a year-on-year increase of 132.7 billion yuan but a slight month-on-month decrease of 28.5 billion yuan. The issuance of refinancing bonds reached 541.3 billion yuan, a year-on-year increase of 178.2 billion yuan [3][5]. Issuance Rates - The weighted average issuance rate of local government bonds rose by 16.77 basis points to 2.09% in March 2025. The issuance rates for various maturities also increased, with the 3-year, 5-year, 7-year, 10-year, 15-year, 20-year, and 30-year bonds rising by 13.72 bps, 16.08 bps, 18.22 bps, 18.12 bps, 24.02 bps, 16.38 bps, and 17.21 bps respectively [15][18]. Issuance Spread - The increase in local government bond rates exceeded that of national treasury yields, leading to a widening of the issuance spreads across all maturities. The spreads for 3-year, 5-year, 7-year, 10-year, 15-year, 20-year, and 30-year bonds increased by 2.89 bps, 7.69 bps, 3.11 bps, 6.46 bps, 9.28 bps, 4.59 bps, and 2.65 bps respectively. Hebei and Henan had relatively high issuance spreads of 24.60 bps and 23.48 bps respectively [15][17]. Issuance Maturity - The average issuance maturity of local government bonds in March was 17.33 years, a slight decrease of 0.22 years from the previous month. The average maturities for new general bonds and new special bonds increased by 0.04 years and 1.99 years to 8.65 years and 19.37 years respectively, while the average maturity for refinancing bonds decreased by 1.61 years to 17.16 years [18][20]. Fund Utilization - The primary focus of the funds raised through new special bonds in March was on infrastructure projects, with 62.25% of the funds allocated to "municipal and industrial park infrastructure," "transportation infrastructure," and "public services," reflecting a 14.11 percentage point increase from the previous month. The amounts allocated to these areas were 95.1 billion yuan, 90.4 billion yuan, and 40.8 billion yuan respectively [23][26].

Core Points - The U.S. Treasury auctioned $58 billion in three-year notes with a winning yield of 3.784%, down from 3.908% on March 11 [1] - The bid-to-cover ratio was 2.47, slightly lower than the previous auction's ratio of 2.70 [1] Summary by Category Auction Details - The amount auctioned was $58 billion [1] - The winning yield decreased to 3.784% from 3.908% [1] - The bid-to-cover ratio was recorded at 2.47, compared to 2.70 in the last auction [1]