Core Viewpoint - Geopolitical factors are profoundly reshaping the global interest rate curve through a "security" premium, with the rise in long-term rates being a structural change driven by fiscal expansion for national security rather than simple cyclical fluctuations. High inflation-driven fiscal expansion has significantly weakened the traditional safe-haven characteristics of bonds. The macro narrative brought by Trump will continue to dominate asset price fluctuations ahead of the U.S. midterm elections, with RMB-denominated assets already showing "safe haven" attributes [4]. Group 1: Long-term Interest Rates - The synchronized rise in long-term interest rates across major economies is not merely driven by economic cycles but represents a structural shift under geopolitical fragmentation. Concerns over uncontrolled fiscal deficit expansion and tariff conflicts following Trump's "first hundred days" have led markets to reprice long-term inflation and sovereign credit risks [5]. Group 2: Pricing of Term Premium - The term premium is undergoing a paradigm shift, where national security, supply chain restructuring, and technological competition are replacing sovereign credit as the new anchor for long-term bond pricing. The "weaponization" of U.S. Treasuries has exposed the wave of "safety" for reserve assets, while competitive fiscal expansion, re-industrialization, and resource hoarding have completely disrupted the self-regulating supply-demand mechanism [6]. Group 3: Potential Disruption of Narratives - The current steepening of the interest rate curve began with Trump's inauguration on January 20, 2025, but the sustainability of this political momentum faces serious challenges from the midterm elections. If political momentum wanes, the "security premium" logic may weaken, leading to significant volatility in commodity and precious metal prices. However, narrative trading will still dominate the market in the first half of 2026, with caution advised for potential bidirectional fluctuations due to policy adjustments in the second half. In this context, RMB-denominated assets stand out as a "safe haven" due to robust fiscal discipline and stable currency value [7].

Group 1 - Hong Kong is positioned as a key international financial center, facilitating both Chinese enterprises' global expansion and Middle Eastern companies' entry into the Chinese market [1] - Approximately 300 mainland companies are preparing to list in Hong Kong, with many planning to expand into the Middle Eastern market [1] - Hong Kong leads in offshore RMB, asset and wealth management, and family office sectors, managing over $4.5 trillion in assets [1] Group 2 - The Hong Kong government is accelerating the development of the Northern Metropolis as a driver for economic diversification and innovation in technology industries [2] - Flexible approaches are being adopted to attract technology enterprises, including land allocation and talent importation [2] - The establishment of the Hong Kong Investment Management Company aims to attract businesses and cultivate industry ecosystems through patient capital and co-investment strategies [2]

Group 1 - Several foreign institutions have raised their GDP growth forecasts for China in 2025, indicating a growing optimism towards Chinese assets [1][8][11] - Morgan Stanley, Deutsche Bank, and others have expressed bullish sentiments on Chinese stocks, with Morgan Stanley's mid-year outlook predicting increases in major indices [1][4][5] - High demand for Chinese assets is driven by a stronger RMB against the USD, improved corporate earnings outlook, and anticipated foreign capital inflows [5][6] Group 2 - Foreign institutions are focusing on two main sectors: technology and internet leaders, and high-dividend strategies to hedge against volatility [6][7] - The trend of overweighting Chinese assets has been noted, with Standard Chartered and HSBC highlighting the importance of diversifying investments in Asia [7] - Recent adjustments in GDP growth forecasts reflect a broader expectation of economic improvement, supported by policy measures and potential fiscal stimulus [8][9][11]