Report Summary 1. Investment Rating The document does not mention the industry investment rating. 2. Core Views - Standing at the end of August and looking forward to September, investors are confused about the general direction of the bond market. The bullish sentiment has decreased, and operations have become more prudent. The capital market and the equity market are the core concerns of investors, and the preference for local bonds, high - grade urban investment bonds, and perpetual bonds has marginally weakened [1]. - Four mainstream expectations for the September bond market: concentrated expectations for the upper and lower limits of long - term treasury bond yields; decreased bullish sentiment in the bond market, more cautious operations, and an upward - moving interest rate oscillation center; changed overall expectations for the August economy, with increased expectations for reserve requirement ratio cuts and interest rate cuts; consistent preference for medium - and short - term interest - rate bonds and increased preference for convertible bonds [2]. 3. Summary by Directory 1. Investor Expectations are Divergent and Behavior is More Prudent - **Survey Overview**: A bond market questionnaire was released on August 26, 2025, and 114 valid questionnaires were received by August 28, covering various institutional and individual investors [9]. - **Long - term Treasury Bond Yield Expectations** - **10 - year Treasury Bonds**: 85% of investors think the lower limit of the 10 - year treasury bond yield is likely to be in the 1.65% - 1.75% range, and 51% think the upper limit is likely to be in the 1.80% - 1.85% range. Investors' expectations for an increase in the 10 - year treasury bond interest rate are gradually rising [11]. - **30 - year Treasury Bonds**: 41% of investors think the lower limit of the 30 - year treasury bond yield is likely to be in the 1.90% - 1.95% range, and 44% think the upper limit is likely to be in the 2.05% - 2.10% range. Investors are cautious about the potential further increase in the 30 - year treasury bond yield [13]. - **Economic Outlook for August**: Investor responses were relatively evenly distributed. 29% think the economy in August will show a "both year - on - year and month - on - month weakening" performance. Pessimistic expectations have decreased from 31% to 29% [15][17]. - **Expectations for Reserve Requirement Ratio Cuts and Interest Rate Cuts**: 42% of investors think there will be no further reserve requirement ratio cuts this year, and 46% think there will be no interest rate cuts. Most investors tend to postpone potential reserve requirement ratio cuts and interest rate cuts to a more distant policy window [20]. - **Impact of the Equity Market on the Bond Market**: 70% of investors think the recent strengthening of the equity market will strengthen the stock - bond seesaw effect and suppress the bond market. However, some investors think the impact is short - term [24]. - **September Bond Market Outlook**: Investor expectations for the bond market are divergent. The proportions of investors expecting the bond market to "strengthen overall with a bull - flattened yield curve" and "weaken overall with a bear - steepened yield curve" are both 23%. The preference for the short - end has also decreased [25]. - **Bond Market Operations**: In September, most investors are neutral in practice. Holding cash and waiting is the mainstream view, with a marginal increase in the proportion of investors maintaining positions and taking profits [28]. - **Preferred Bond Types**: In August, investors maintained their positions in medium - and short - term interest - rate bonds and increased their preference for convertible bonds. The preference for local bonds, high - grade urban investment bonds, and perpetual bonds decreased slightly [30]. - **Main Bond Pricing Logic**: Monetary policy, capital market conditions, and the performance of the equity market are the core concerns of bond investors. This month, the attention to the equity market has increased significantly, while the attention to institutional behavior games and fiscal policy has decreased [32].

Report Summary 1. Industry Investment Rating No industry investment rating is provided in the report. 2. Core View Standing at the end of July and looking forward to August, investors' sentiment for going long in the bond market has declined. The consensus has shifted from going long on long - term and ultra - long - term bonds to medium - and short - term interest - rate bonds. The money market and the equity market have become the core concerns of investors, and their preference for medium - and low - grade urban investment bonds and local government bonds has weakened marginally [1]. 3. Summary by Questionnaire Items Q2: 10 - year Treasury Yield Upper and Lower Limits in August - Regarding the lower limit, 45% of investors think it will likely fall within 1.60% - 1.65% (inclusive), 18% believe it will break below 1.60% (mostly in the 1.55% - 1.60% range), and about 37% think it will exceed 1.65%. - Regarding the upper limit, 51% of investors think it will likely fall within 1.75% - 1.80% (inclusive), about 14% think it will exceed 1.80%, and only 4% think it will be below 1.70%. - Conclusion: Investors' expectation of a rise in the 10 - year Treasury yield is increasing, but they are still cautious about it breaking key points. The bond market may face some emotional shocks in August, but the macro - fundamentals are in a weak recovery, the money market is stable, and the expectation of loose monetary policy remains unchanged [10]. Q3: 30 - year Treasury Yield Upper and Lower Limits in August - Regarding the lower limit, over 73% of investors think it will fall within 1.80% - 1.90% (inclusive), 18% think it will break above 1.90%, and only 8% think it will be below 1.80%. - Regarding the upper limit, about 56% of investors think it will fall within 1.95% - 2.00% (inclusive), 24% think it will be in the 2.00% - 2.05% range, and about 9% think it will break above 2.05%. - Conclusion: Since July, the 30 - year Treasury yield has been rising, reaching a maximum of 1.998%. Investors' expectation of a further increase in the 30 - year Treasury yield is not high [14]. Q4: Economic Trend in the Third Quarter - 31% of investors are relatively optimistic about the economic trend in the third quarter, believing it will show "year - on - year recovery and month - on - month growth exceeding the seasonal level". - 24% think it will be "year - on - year recovery and month - on - month growth in line with the seasonal level". - 34% think it will be "year - on - year recovery and month - on - month growth weaker than the seasonal level". - 31% are relatively pessimistic, believing it will be "both year - on - year and month - on - month decline". - Conclusion: External factors may have some impact on the macro - economy in the third quarter, but the overall expectation of investors has not changed much, with the proportion of pessimistic expectations rising from 30% to 31% [15]. Q5: Next Reserve Requirement Ratio Cut and Interest Rate Cut Timing - Regarding reserve requirement ratio cuts, 43% of investors think there will be no more cuts this year, 47% think the next cut may be in the third quarter, and 9% think it will be postponed to the fourth quarter. - Regarding interest rate cuts, 41% of investors think there will be no cuts this year, 41% think the next cut may be in the fourth quarter, and 19% think it will be in August or the third quarter. - Conclusion: In July, investors' expectations for reserve requirement ratio and interest rate cuts have gradually weakened. Most investors tend to postpone potential cuts to a more distant policy window rather than August [17]. Q6: Impact of the Recent "Anti - Involution" Policy on the Bond Market - 71% of investors think the "anti - involution" policy will be negative for the bond market. - 43% think it will strengthen the stock - bond seesaw effect and suppress the bond market through capital diversion. - 28% think it will push up industrial product prices, intensify inflation expectations, and be negative for the bond market. - 17% think the policy's effect is limited, and the bond market is still dominated by fundamentals. - Conclusion: The "anti - involution" policy has some impact on the macro - economy and the bond market, but no obvious trend is seen. Most investors think it will be negative for the bond market, but some think the impact is short - term [18]. Q7: Bond Market Trend in August - 28% of investors think the bond market will strengthen in August, with 13% expecting a bullish steepening of the yield curve and 15% expecting a bullish flattening. - 31% of investors think the bond market will be weak. - 26% of investors think the bond market will show a divergence between the short - end and the long - end, with the short - end strong and the long - end weak. - 2% of investors think the short - end will be weak and the long - end will be strong. - Conclusion: Investors' consensus has shifted to going long on short - term bonds. The proportion of those thinking the bond market will strengthen is significantly lower than in June. Investors' judgments on the bond market are relatively evenly distributed [22]. Q8: Current Bond Market Operation - 33% of investors think they should hold cash and wait to add positions after the market corrects to the expected level. - 20% of investors think they can start adding positions now. - 19% of investors think they should reduce the duration to control risks. - 14% of investors think they should take appropriate profits and reduce positions. - 14% of investors think they should keep the positions basically stable. - Conclusion: Most investors are neutral in practice. Holding cash and waiting is the mainstream view. The proportion of those thinking they can start adding positions has increased, indicating potential buying power in the bond market [23]. Q9: Most Favored Bond Types in August - Compared with June, investors' preference for ultra - long - term and long - term interest - rate bonds has decreased, while their preference for medium - and short - term interest - rate bonds has increased significantly. - The popularity of local government bonds and medium - and low - grade urban investment bonds has decreased. - Conclusion: Investors' consensus has shifted from long - term and ultra - long - term interest - rate bonds to medium - and short - term interest - rate bonds, and their preference for negotiable certificates of deposit has also increased [29]. Q10: Main Logic of Bond Market Pricing in August - Monetary policy, the money market, and the performance of the equity market have become the core concerns of bond investors. - Investors' attention to fiscal policy and government bond issuance remains the same, while their attention to fundamentals and institutional behavior games has decreased. - Conclusion: The central bank's monetary policy stance and the money market trend are still the factors that investors focus on. This month, investors' attention to the equity market has increased significantly, while their attention to institutional behavior games and fiscal policy has decreased [30].

Core Insights - The report discusses the continuous weakness in medium and short-term interest rate bonds since the beginning of the year, attributing this to a correction from the relatively strong performance observed last year [2] - The strong performance of medium and short-term bonds last year was primarily due to the central bank's warnings regarding long-term interest rate risks and the purchase of government bonds [2] - The report suggests that medium and short-term bonds may not continue to underperform and could follow market trends, especially if the central bank engages in government bond transactions [2] Industry Performance - The report highlights the top-performing industries over different time frames, with the communication sector showing a 49.0% increase over the past year, followed by comprehensive industries at 70.5% [1] - Conversely, the report notes the underperforming sectors, such as beauty care and coal, which have shown negative returns of -13.2% and -2.4% respectively over the past year [1]