Group 1 - The report indicates that the liquidity environment remains stable, with short-term rates continuing to decline, benefiting from a stable liquidity environment [5][8] - For April, the report highlights that the initial liquidity is expected to ease, with a focus on the government bond issuance plan, particularly the long-term supply schedule [5][8] - The report notes that the total issuance of local government bonds is expected to reach 31,988 billion yuan by April 5, 2026, with 16,618 billion yuan in long-term bonds, accounting for 52% of the total [12][39] Group 2 - The report anticipates that the local government bond issuance plan for the second quarter will be significant, with a total planned issuance of 21,100 billion yuan [13][40] - It is mentioned that the issuance of replacement bonds is progressing slower than in the same period of 2025, which may lead to a higher actual issuance scale in the second quarter [13][40] - The report identifies potential investment opportunities in the long-term local government bonds, particularly focusing on the yield spread between 30-year and 20-year bonds [41][42] Group 3 - The report tracks the interbank certificate of deposit (CD) market, noting that the issuance increased to 7,705 billion yuan from March 23 to March 27, 2026, with a net financing of 723 billion yuan [53][54] - The report highlights that the overall issuance success rate for CDs remains high at 93%, with the highest success rate for 9-month CDs at 97% [53][54] - The report indicates that the secondary market for CDs has maintained low yields, with rates for various maturities showing slight declines [74]

Group 1: Monetary Policy and Market Operations - The People's Bank of China conducted a 7-day reverse repo operation of 32.5 billion yuan at a fixed rate of 1.40%, with a net injection of 15 billion yuan after accounting for maturing repos [3][4]. - The interbank market is experiencing a very loose liquidity environment, with the weighted average rate of DR001 falling over 3 basis points to around 1.27% [5]. - The latest transaction for one-year interbank certificates of deposit is around 1.51%, unchanged from the previous day [6]. Group 2: Economic Indicators and Government Actions - The PBOC's monetary policy committee discussed the integration of incremental and stock policies to maintain liquidity and align social financing scale with economic growth and price expectations [13]. - The Ministry of Finance announced arrangements for the issuance of various government bonds, including a 30-year bond on April 3 [13][14]. - Data from the Ministry of Finance shows that from January to February, state-owned enterprises reported total operating income of 12,565.5 billion yuan, a year-on-year increase of 0.2%, while total profits decreased by 2.0% [13]. Group 3: Global Economic Context - U.S. officials report that President Trump is willing to end military actions against Iran even if the Strait of Hormuz remains largely closed, indicating a shift towards diplomatic pressure [16]. - The European Central Bank's council member Müller suggests that the ECB's baseline scenario may be overly optimistic, with potential interest rate increases in the coming quarters if energy prices remain high [16]. Group 4: Bond Market Developments - Agricultural Development Bank plans to issue up to 14 billion yuan in financial bonds on April 1 [18]. - Morgan Stanley has downgraded its global equity rating from overweight to neutral while upgrading U.S. Treasury and cash ratings from neutral to overweight [19]. - A series of negative events in the bond market have been reported, including downgrades and delays in ratings for various issuers [20].

1. Report Industry Investment Rating No information provided in the report regarding the industry investment rating. 2. Core Viewpoints of the Report - In February 2026, bond supply decreased year - on - year, mainly dragged down by inter - bank certificates of deposit. The year - on - year decline in the supply of inter - bank certificates of deposit and interest - rate bonds in February 2026 was 739.6 billion yuan and 515.2 billion yuan respectively. The combined year - on - year decline in the new custody volume of inter - bank certificates of deposit and financial bonds in February 2026 was 890.4 billion yuan, possibly due to the delayed approval of bank bond issuance quotas. The new custody volume of corporate credit bonds decreased by 69.4 billion yuan year - on - year, mainly due to the decline in urban investment bonds [4][9][19]. - In February 2026, most institutions increased their bond allocations less, except for securities firms. Commercial banks (after considering the central bank's outright reverse repurchase) increased their bond holdings 886.8 billion yuan less year - on - year; asset management accounts (i.e., non - legal person products) increased their bond holdings 240.4 billion yuan less year - on - year, insurance companies increased their bond holdings 183.8 billion yuan less year - on - year, and securities firms increased their bond holdings 42.7 billion yuan more year - on - year [4][22]. - In March 2026, the supply of government bonds decreased by nearly 500 billion yuan year - on - year, possibly due to the decrease in the pressure of stabilizing economic growth. The supply of government bonds in April 2026 may increase slightly year - on - year. The supply of inter - bank certificates of deposit and bank financial bonds continued to decline in March 2026. If the quotas for inter - bank certificates of deposit and bank financial bonds are approved at the end of March or early April, their supply may increase in April [4][40][45]. - In March 2026, the net bond - buying scale of banks in the secondary market increased year - on - year, which was related to the low base last year and the weakening of credit demand in March this year. The net bond - buying scale of insurance companies in the secondary market decreased year - on - year, possibly because insurance companies increased the proportion of equity and other assets. The net bond - buying scale of asset management accounts decreased slightly year - on - year, possibly because the new scale of bank wealth management continued to decline [4][50][51]. 3. Summary by Relevant Catalogs 3.1 Bond Supply in February 2026 - **Overall Situation**: In February 2026, the bond custody balance was 196.39 trillion yuan, with a year - on - year growth rate of 10.42%, a decrease of 0.98 percentage points from the previous month. The new custody scale in February was 1060.4 billion yuan, a year - on - year decrease of 1439.1 billion yuan [4][6]. - **By Bond Type**: Inter - bank certificates of deposit were the main bond type with a year - on - year decline in supply in February. The supply of inter - bank certificates of deposit and interest - rate bonds decreased by 739.6 billion yuan and 515.2 billion yuan respectively year - on - year. Considering January and February together, the new custody volume of national bonds and local bonds this year was roughly the same year - on - year, but the new custody volume of policy - based financial bonds decreased significantly. The combined year - on - year decline in the new custody volume of inter - bank certificates of deposit and financial bonds in February 2026 was 890.4 billion yuan, possibly due to the delayed approval of bank bond issuance quotas. The new custody volume of corporate credit bonds decreased by 69.4 billion yuan year - on - year, mainly due to the decline in urban investment bonds [4][9][19]. 3.2 Bond Allocation by Institutions in February 2026 - **Overall Situation**: Most institutions increased their bond allocations less in February 2026, except for securities firms. Commercial banks (after considering the central bank's outright reverse repurchase) increased their bond holdings 886.8 billion yuan less year - on - year; asset management accounts increased their bond holdings 240.4 billion yuan less year - on - year, insurance companies increased their bond holdings 183.8 billion yuan less year - on - year, and securities firms increased their bond holdings 42.7 billion yuan more year - on - year [22]. - **Banks**: The bond - allocation intensity of banks decreased in February 2026. The scale of banks' increased holdings of government bonds/government bond net supply was 84.9%, significantly higher than the average of 77.9% in the past 12 months, but the bond - allocation intensity in February decreased compared with January, possibly related to the year - on - year decrease in the deposit - loan difference [28]. - **Insurance Companies**: The new bond investment scale of insurance companies decreased year - on - year in February 2026. Structurally, insurance companies mainly increased their allocations of local bonds less. After excluding supply disturbances, the bond - allocation intensity of insurance companies also weakened in February. The scale of insurance companies' increased holdings of government bonds/new government bond custody was about 0.6%, a decrease from January and significantly lower than the average of 9.2% in the past 12 months [29]. - **Asset Management Accounts**: The new scale of wealth management and the supply of inter - bank certificates of deposit both decreased significantly year - on - year in February 2026, leading to a year - on - year decrease in the bond - holding increase of asset management accounts. The new scale of wealth management in February 2026 was - 1.11 trillion yuan, lower than the same period from 2023 to 2025. The contraction of the supply of inter - bank certificates of deposit in February 2026 may also be an important reason for the decline in the bond - allocation intensity of asset management accounts [33]. - **Foreign Capital and Securities Firms**: Foreign capital decreased its bond holdings by 98.2 billion yuan year - on - year, mainly reducing its holdings of inter - bank certificates of deposit. The significant year - on - year decrease in the supply of inter - bank certificates of deposit in February 2026 may have limited the bond - allocation ability of foreign capital. Securities firms increased their bond holdings by 42.8 billion yuan year - on - year, mainly increasing their holdings of local bonds, possibly because the spread between local bonds and national bonds narrowed in February [38]. 3.3 Outlook for Bond Supply and Market Conditions - **Government Bonds**: In March 2026, the supply of government bonds decreased by nearly 500 billion yuan year - on - year, possibly due to the decrease in the pressure of stabilizing economic growth. The supply of government bonds in April 2026 may increase slightly year - on - year. The issuance of new local bonds in April 2026 is expected to increase year - on - year, but the issuance of refinancing bonds after deducting repayments may decrease. After combining various varieties, the supply of local bonds in April may increase slightly year - on - year [40]. - **Inter - bank Certificates of Deposit and Bank Financial Bonds**: The supply of inter - bank certificates of deposit and bank financial bonds continued to decline in March 2026. If the quotas for inter - bank certificates of deposit and bank financial bonds are approved at the end of March or early April, their supply may increase in April [45]. - **Banks, Insurance Companies, and Asset Management Accounts**: In March 2026, the net bond - buying scale of banks in the secondary market increased year - on - year, which was related to the low base last year and the weakening of credit demand in March this year. The net bond - buying scale of insurance companies in the secondary market decreased year - on - year, possibly because insurance companies increased the proportion of equity and other assets. The net bond - buying scale of asset management accounts decreased slightly year - on - year, possibly because the new scale of bank wealth management continued to decline [50][51].

Group 1: Open Market Operations - The central bank announced a 7-day reverse repurchase operation on March 30, with a fixed rate and quantity tendering, amounting to 269.5 billion yuan at an interest rate of 1.40%, with a net injection of 261.5 billion yuan after accounting for 8 billion yuan of reverse repos maturing on the same day [1]. Group 2: Funding Conditions - The interbank market continues to show a loose funding environment, with the weighted average rate of DR001 slightly declining to around 1.31%. Overnight quotes on the anonymous click system (X-repo) remained stable at 1.30%, indicating ample liquidity. Non-bank institutions' overnight quotes for pledged certificates of deposit and credit bonds also stabilized around 1.4% [3]. - The central bank's increased reverse repo operations have exceeded expectations in terms of liquidity support [3]. Group 3: Interbank Certificates of Deposit - The latest transaction rate for one-year interbank certificates of deposit among major banks is approximately 1.51%, down nearly 2 basis points from the previous day [7]. Group 4: Bond Market Overview - Major interest rate bonds in the interbank market saw collective yield declines, with the 30-year main contract rising by 0.38%, the 10-year by 0.15%, the 5-year by 0.10%, and the 2-year by 0.04% [16]. Group 5: Policy and Regulatory Updates - The State Administration for Market Regulation issued a notice to further implement the Anti-Unfair Competition Law, focusing on preventing "involution" competition in key industries such as platform economy, photovoltaic, lithium batteries, and new energy vehicles [12]. - The Ministry of Commerce announced plans to optimize the implementation of the old-for-new consumption policy, emphasizing green and intelligent initiatives to boost new industries and enhance consumer spending in the automotive sector [12]. - Local governments are accelerating the replacement of hidden debts, with approximately 0.96 trillion yuan of refinancing special bonds issued for this purpose as of March 30, accounting for nearly half of the planned issuance for the year [12].

1. Report Industry Investment Rating No information provided in the content. 2. Core View of the Report - This week (March 23 - March 27), the fund slightly reduced leverage, and the large - scale banks decreased their average daily lending. The maturity of certificates of deposit decreased, and the yield curve of certificates of deposit steepened. In the spot bond trading, the main buyers were funds, with funds increasing their holdings of 7 - 10Y interest - rate bonds and short - term credit bonds. Large - scale banks increased their holdings of certificates of deposit, money market funds were the main sellers and net - sold certificates of deposit, securities firms and small and medium - sized banks mainly sold bonds, and insurance companies increased their holdings of interest - rate bonds [4]. 3. Summary by Directory 3.1 Monetary Fundamentals - **Liquidity Injection**: From March 23 - 27, there were 17.65 billion yuan of reverse repurchase maturities. The central bank respectively injected 0.8 billion, 1.75 billion, 7.85 billion, 22.4 billion, and 14.62 billion yuan of reverse repurchase from Monday to Friday, with a total injection of 47.42 billion yuan. On Wednesday, there were 50 billion yuan of MLF injection and 45 billion yuan of MLF maturity. The net liquidity injection for the whole week was 28.19 billion yuan [4][7]. - **Funding Rates**: As of March 27, R001, R007, DR001, and DR007 were 1.39%, 1.51%, 1.32%, and 1.44% respectively, changing by - 0.9BP, 3BP, - 0.28BP, and 1.89BP compared to March 13, and were at the 18%, 9%, 14%, and 3% historical quantiles respectively [4][9]. - **Large - scale Bank Lending**: From March 23 - 27, the total lending scale of large - scale banks was 24.99 trillion yuan, with a maximum daily lending scale of 5.4 trillion yuan and an average daily lending scale of 5.0 trillion yuan, a decrease of 0.57 trillion yuan compared to the previous week's daily average [4][14]. - **Pledged Repurchase**: The average daily trading volume of pledged repurchase was 7.94 trillion yuan, with a maximum daily volume of 8.29 trillion yuan, a 5.21% decrease compared to the previous week's daily average. The average daily proportion of overnight repurchase transactions was 88.4%, with a maximum daily proportion of 91.7%, a decrease of 2.83 percentage points compared to the previous week's daily average, and as of March 27, it was at the 78.5% quantile [4][15]. 3.2 Certificates of Deposit and Bills - **Issuance and Maturity of Certificates of Deposit**: The issuance scale of inter - bank certificates of deposit increased week - on - week, with a total issuance of 77.052 billion yuan, an increase of 1.183 billion yuan compared to the previous week. The maturity volume was 69.82 billion yuan, a decrease of 46.466 billion yuan compared to the previous week. The net financing was 7.23 billion yuan, an increase of 47.649 billion yuan compared to the previous week. In the next week (March 30 - April 5), the maturity of certificates of deposit was 54.687 billion yuan [4][19][23]. - **Issuance by Bank Type**: The issuance scale of joint - stock banks was the highest. The issuance scales of state - owned banks, joint - stock banks, city commercial banks, and rural commercial banks were 22.982 billion yuan, 26.255 billion yuan, 25.077 billion yuan, and 1.987 billion yuan respectively, changing by 10.525 billion yuan, 2.651 billion yuan, - 8.782 billion yuan, and - 1.29 billion yuan compared to the previous week [19]. - **Issuance by Maturity Type**: The 9M issuance scale was the highest. The issuance scales of 1M, 3M, 6M, 9M, and 1Y inter - bank certificates of deposit were 7.975 billion yuan, 8.77 billion yuan, 13.193 billion yuan, 24.299 billion yuan, and 22.815 billion yuan respectively, changing by 2.543 billion yuan, 0.071 billion yuan, - 7.044 billion yuan, 9.114 billion yuan, and - 3.501 billion yuan compared to the previous week. The 9M certificates of deposit accounted for the highest proportion (31.54%) of the total issuance of certificates of deposit by different types of banks, mainly issued by state - owned banks; the 1Y maturity accounted for 29.61%, mainly issued by joint - stock banks [19]. - **Issuance and Yield Rates**: Most of the issuance rates of certificates of deposit of each bank increased, and the issuance rates of certificates of deposit of each maturity showed differentiation. As of March 27, the one - year issuance rates of joint - stock banks, state - owned banks, city commercial banks, and rural commercial banks changed by 0.49BP, - 0.5BP, 4.37BP, and 7.12BP respectively compared to March 20, and were at the 0%, 1%, 0%, and 1% historical quantiles. The issuance rates of 1M, 3M, and 6M certificates of deposit changed by 1.59BP, - 0.5BP, and - 0.65BP respectively compared to March 20, and were at the 3%, 0%, and 0% historical quantiles. The yield curve of certificates of deposit steepened. As of March 27, the 1M, 3M, 6M, 9M, and 1Y maturity yields of AAA - rated inter - bank certificates of deposit of commercial banks were 1.42%, 1.46%, 1.48%, 1.51%, and 1.53% respectively, changing by - 4BP, - 1BP, 0.75BP, 1BP, and 1BP compared to March 20 [25][29]. - **Shibor Rates**: Most of the Shibor rates decreased. As of March 27, the overnight, 1 - week, 2 - week, 1M, and 3M Shibor rates changed by - 0.2BP, 1.1BP, - 2.1BP, - 1.55BP, and - 1.3BP respectively compared to March 20, reaching 1.32%, 1.43%, 1.5%, 1.5%, and 1.51% [27]. - **Bill Rates**: The bill rates decreased. As of March 27, the 3M direct discount rate of national - share bills, 3M transfer discount rate of national - share bills, 6M direct discount rate of national - share bills, and 6M transfer discount rate of national - share bills were 1.5%, 1.35%, 1.17%, and 1.11% respectively, changing by - 4BP, - 5BP, - 6BP, and - 6BP compared to March 20 [33]. 3.3 Institutional Behavior Tracking - **Leverage Ratio**: The inter - bank leverage ratio decreased slightly week - on - week. As of March 27, the total inter - bank leverage ratio in the bond market decreased by 0.08 percentage points to 105.15% compared to March 20, and was at the 15.90% historical quantile since 2021. The leverage ratios of banks, securities firms, insurance companies, and broad - based funds were 103.6%, 200.1%, 130.4%, and 104% respectively, changing by - 0.33BP, - 1.17BP, 1.1BP, and - 0.05BP compared to March 20, and were at the 15%, 11%, 82%, and 1% historical quantiles as of March 27 [35][37]. - **Net Buying Duration**: The net - buying weighted average duration of funds increased compared to the previous week, while that of insurance companies decreased. As of March 27, the net - buying weighted average duration (MA = 10) of funds was 1.36 years, recovering from - 1.13 years on March 20, and was at the 40% historical quantile. The net - buying weighted average duration (MA = 10) of wealth management products was 0.70 years, showing an increase compared to March 20, and was at the 49% historical quantile. The net - buying weighted average duration (MA = 10) of securities firms was - 1.35 years, showing an increase compared to March 20, and was at the 55% historical quantile. The net - buying weighted average duration (MA = 10) of insurance companies was 10.08 years, showing a decrease compared to March 20, and was at the 64% historical quantile [39]. - **Duration of Bond Funds**: The duration of medium - and long - term pure - bond funds recovered. As of March 27, the duration of medium - and long - term pure - bond funds recovered by 0.07 years to 3.10 years compared to March 20, and was at the 13% historical quantile since 2025. The duration of short - term pure - bond funds recovered by 0.10 years to 1.57 years compared to March 20, and was at the 56% historical quantile since 2025 [43].

Group 1 - The report emphasizes the importance of nominal growth, with expectations for a moderate increase in nominal GDP growth to around 5.3% in Q2, influenced by high oil prices and a stable inflation index [4][34][35] - Export performance is projected to show some short-term slowdown, but medium-term resilience is expected due to China's industrial chain advantages, which may help offset the impact of high oil prices on external demand [4][17][21] - The real estate market is characterized by a "small spring" effect, where volume increases are driven by price reductions, but the foundation for stabilization remains uncertain, particularly in April [4][22][27] Group 2 - Monetary conditions indicate limited probability for broad monetary easing, with banks potentially shifting their liability structures, leading to a stable funding environment [4][10][11] - The supply-demand dynamics in the bond market are improving, with manageable supply pressures and increased non-bank institutional participation, which is expected to enhance the overall market conditions [4][13][18] - The report suggests that Q2 typically presents a favorable environment for asset management products, indicating a good window for achieving higher portfolio returns [4][5][22] Group 3 - The bond market strategy focuses on maintaining a safety cushion in a "money-rich" environment, emphasizing small-scale trading opportunities and the exploration of excess yield spreads [4][6][7] - The report anticipates that the 10-year government bond yield will fluctuate between 1.75% and 1.85%, while the 30-year bond yield may see core fluctuations around 40-50 basis points [4][7][11] - Attention is drawn to the potential for yield compression and structural opportunities in the bond market, particularly with the expected increase in asset management product sizes in April [4][6][7]

Report Investment Rating - No industry investment rating is provided in the report [1] Core Viewpoints - In March, the bond market showed a divergence in short - and long - term trends. Short - term yields mostly declined, while long - term yields mostly rose. On March 27, the yields of 1 - year/3 - year/5 - year/10 - year/30 - year treasury bonds were 1.25%, 1.33%, 1.55%, 1.82%, and 2.35% respectively, down - 7.0BP/ - 5.2BP/+1.0BP/+4.2BP/+7.8BP compared to February 28 [2][80] - From January to February 2026, the total profit of industrial enterprises above designated size reached 1.02 trillion yuan, a year - on - year increase of 15.2%. The conflict between the US and Iran may narrow the decline of PPI, but due to international energy price fluctuations, enterprise profits in March may be under pressure [2][80] - The recent significant appreciation of the RMB is beneficial to the Chinese bond market. Currently, the long - bond positions of trading desks are still relatively small. The year - on - year recovery of PPI is a general market expectation, and the risk of long - term bonds may be low. It is recommended to seize trading opportunities [2][80] Summary by Directory 1. Macro News - From January to February 2026, the total profit of industrial enterprises above designated size was 1.02 trillion yuan, a year - on - year increase of 15.2%. The operating income was 20.84 trillion yuan, a year - on - year increase of 5.3%. The operating cost was 17.68 trillion yuan, a year - on - year increase of 5.0%. The operating income profit margin was 4.92%, a year - on - year increase of 0.43 percentage points [8] - In January - February 2026, both the general public budget revenue and expenditure increased year - on - year. The general public budget revenue was 4.4 trillion yuan, a year - on - year increase of 0.7%. Tax revenue was 3.6 trillion yuan, a year - on - year increase of 0.1%; non - tax revenue was 0.8 trillion yuan, a year - on - year increase of 3.4%. The general public budget expenditure was 4.7 trillion yuan, a year - on - year increase of 3.6% [10] 2. Mid - level High - frequency Data 2.1 Consumption - As of March 22, the daily average retail volume of passenger cars by manufacturers was 5.1 million vehicles, a year - on - year decrease of 7.0%, and the daily average wholesale volume was 6.2 million vehicles, a year - on - year decrease of 3.0% [17] - As of March 27, the total box office revenue of national movies in the past 7 days was 321.205 million yuan, a year - on - year increase of 35.1% [17] - As of March 20, the total retail volume of three major household appliances was 1.003 million units, a year - on - year decrease of 27.2%, and the total retail sales were 2.19 billion yuan, a year - on - year decrease of 28.9% [23] 2.2 Transportation - As of March 28, the average migration scale index in the past 7 days was 472.3, a year - on - year increase of 6.1% [27] - As of March 22, the number of civil aviation flights guaranteed in the current week was 1.23 million, a year - on - year increase of 3.4% [27] - As of March 27, the average daily passenger volume of the subway in first - tier cities in the past 7 days was 40.56 million person - times, a year - on - year increase of 0.6% [27] - As of March 22, the current - week express delivery collection volume was 3.85 billion pieces, a year - on - year increase of 4.4%, the delivery volume was 3.89 billion pieces, a year - on - year increase of 5.5%, the railway freight volume was 80.312 million tons, a year - on - year increase of 1.0%, and the highway truck traffic volume was 54.585 million vehicles, a year - on - year decrease of 0.1% [30] 2.3 Industry - As of March 27, the iron ore inventory in the current week was 176.668 million tons, a year - on - year increase of 17.9%, the rebar inventory was 6.428 million tons, a year - on - year increase of 5.4%, and the float glass enterprise inventory was 73.622 million tons, a year - on - year increase of 9.9% [32] - As of March 13, the daily coal consumption of key power plants in the current week was 4.85 million tons, a year - on - year decrease of 0.2% [35] - As of March 27, the apparent consumption of steel products in the current week was 8.88 million tons, a year - on - year decrease of 3.5%, the apparent consumption of rebar was 2.254 million tons, a year - on - year decrease of 8.1%, and the apparent consumption of wire rods was 0.92 million tons, a year - on - year decrease of 4.3% [35] - As of March 25, the blast furnace operating rate of major steel enterprises in the current week was 75.3%, a year - on - year decrease of 1.3 percentage points. As of March 26, the average asphalt operating rate was 15.0%, a year - on - year decrease of 8.0 percentage points, the soda ash operating rate was 82.0%, a year - on - year increase of 0.6 percentage points, and the PVC operating rate was 76.1%, a year - on - year decrease of 3.0 percentage points [43] 2.4 Real Estate - As of March 27, the total commercial housing transaction area in 30 large - and medium - sized cities in the past 7 days was 2.706 million square meters, a year - on - year decrease of 10.9% [44] 2.5 Prices - As of March 29, the average wholesale price of pork in the current week was 15.6 yuan/kg, a year - on - year decrease of 25.2%, and a decrease of 8.4% compared to four weeks ago [47] - As of March 27, the average wholesale price of vegetables was 4.8 yuan/kg, a year - on - year increase of 0.3%, and a decrease of 9.8% compared to four weeks ago. The average wholesale price of six key fruits was 7.8 yuan/kg, a year - on - year increase of 3.0%, and a decrease of 2.8% compared to four weeks ago [47] - As of March 27, the average price of thermal coal at northern ports was 755 yuan/ton, a year - on - year increase of 11.7%, and an increase of 3.9% compared to four weeks ago. The average spot price of WTI crude oil was 92.7 US dollars/barrel, a year - on - year increase of 34.0%, and an increase of 42.4% compared to four weeks ago [47] - As of March 27, the average spot price of rebar was 3184.4 yuan/ton, a year - on - year decrease of 0.6%, and an increase of 1.6% compared to four weeks ago. The average spot price of iron ore was 810.1 yuan/ton, a year - on - year increase of 1.6%, and an increase of 5.1% compared to four weeks ago. The average spot price of glass was 13.5 yuan/square meter, a year - on - year decrease of 10.8%, and an increase of 1.7% compared to four weeks ago [54] 3. Bond and Foreign Exchange Markets - On March 27, the overnight Shibor was 1.32%, unchanged from March 23 and down 0.30BP from March 16. R001 was 1.39%, down 0.90BP from March 23 and down 1.22BP from March 16; R007 was 1.51%, up 3.06BP from March 23 and down 0.53BP from March 16. DR001 was 1.32%, down 0.24BP from March 23 and down 0.38BP from March 16; DR007 was 1.44%, up 1.39BP from March 23 and down 1.25BP from March 16. IBO001 was 1.37%, up 0.03BP from March 23 and down 0.27BP from March 16; IBO007 was 1.47%, up 0.57BP from March 23 and down 0.97BP from March 16 [56] - The yields of most treasury bonds declined in the past week. On March 27, the yields of 1 - year/5 - year/10 - year/30 - year treasury bonds were 1.25%/1.55%/1.82%/2.35% respectively, down - 0.7BP/ - 1.0BP/ - 1.2BP/ - 3.7BP compared to March 20 and down - 2.7BP/ - 0.8BP/+0.3BP/ - 1.5BP compared to March 13. The yields to maturity of 1 - year/5 - year/10 - year/30 - year China Development Bank bonds were 1.46%/1.69%/1.96%/2.48% respectively, down - 1.3BP/ - 0.7BP/ - 1.1BP/ - 3.7BP compared to March 20 and down - 3.5BP/ - 2.9BP/ - 0.4BP/ - 2.1BP compared to March 13 [61] - On March 27, the yields to maturity of 1 - year/5 - year/10 - year local government bonds were 1.33%/1.69%/2.00% respectively, down - 4.5BP/ - 1.0BP/+1.7BP compared to March 20 and down - 1.5BP/+1.7BP/+1.7BP compared to March 13. The yields to maturity of AAA 1 - month/1 - year, AA+1 - month/1 - year inter - bank certificates of deposit were 1.43%/1.53%/1.45%/1.55% respectively, down - 3.0BP/+1.3BP/ - 3.0BP/+1.3BP compared to March 20 and down - 7.7BP/ - 0.4BP/ - 7.7BP/ - 0.4BP compared to March 13 [68] - As of March 27, 2026, the yields of 10 - year treasury bonds in the US, Japan, the UK, and Germany were 4.44%, 2.38%, 4.97%, and 3.18% respectively, up 16BP/13.5BP/21.4BP/17BP compared to March 13 [73] - On March 27, the central parity and spot exchange rate of the US dollar against the RMB were 6.91/6.91 respectively, up 243/288 pips compared to March 20 and up 134/75 pips compared to March 13 [76] 4. Institutional Behavior - The duration of medium - and long - term pure bond funds has decreased. On March 27, 2026, the median duration of medium - and long - term interest - rate bond funds was about 2.8 years, a decrease of about 0.48 years compared to March 13. The median duration of credit bond funds was about 1.7 years, a decrease of about 0.97 years compared to March 13 [77][78] 5. Investment Recommendations - In 2026, the total supply of the bond market is expected to be stable, and the supply - demand relationship in the bond market is expected to improve. It is predicted that the yield of 10 - year treasury bonds will fluctuate in the range of 1.6% - 1.9%, and the yield of 30 - year treasury bonds will fluctuate in the range of 1.9% - 2.4%. Currently, it is recommended to pay attention to the opportunities of 30 - year old treasury bonds, 10 - year China Development Bank bonds, and long - duration subordinated capital bonds [82] - The Fed's interest rate cut may be postponed to May 2026 or later. China's exports are resilient, and domestic policy rate cuts may be late, possibly in the middle of the year or later. It is expected that bond market investments may be relatively favorable in the second half of the year [82]

Report Industry Investment Rating No information provided in the text. Core Viewpoints of the Report - In early April after the cross - quarter period, the money market is expected to loosen compared to the previous period, but in the middle and later stages, attention should be paid to the frictional impact of negative factors such as the "big tax period", the possible rapid implementation of new policy - based financial instruments, and the absorption of inter - bank deposits by banks [7]. Summary by Relevant Catalogs 1. Money Market - **Central Bank Operations**: From March 23 - 27, 2026, the central bank's 7 - day reverse repurchase had a net investment of 2319 billion yuan. In April 2026, the maturity scale of 3M and 6M repurchase - style reverse repurchase is 11000 billion yuan and 6000 billion yuan respectively, and the maturity scale of MLF is 6000 billion yuan [2][6]. - **Funding Rates**: From March 23 - 27, 2026, the average values of DR001 and R001 were 1.32% and 1.40% respectively, down 0.1 basis points and basically unchanged compared with March 16 - 20; the average values of DR007 and R007 were 1.43% and 1.50% respectively, down 0.1 basis points and up 1.1 basis points compared with March 16 - 20 [6]. - **Government Bond Net Financing**: From March 23 - 29, 2026, the government bond net financing was about 6064 billion yuan, an increase of about 3001 billion yuan compared with March 16 - 22. From March 30 - April 5, 2026, the government bond net financing is expected to be about 150 billion yuan [7]. 2. Inter - bank Certificates of Deposit - **Yield to Maturity**: As of March 27, 2026, the yields to maturity of 1M and 3M inter - bank certificates of deposit were 1.4150% and 1.4550% respectively, down 4.0 and 1.0 basis points compared with March 20; the yield to maturity of 1Y inter - bank certificates of deposit was 1.5250%, up 1.0 basis point compared with March 20 [8]. - **Net Financing**: From March 23 - 29, 2026, the net financing of inter - bank certificates of deposit was about 738 billion yuan. From March 30 - April 5, 2026, the maturity repayment amount of inter - bank certificates of deposit is expected to be 1513 billion yuan, and the pressure of maturity renewal has significantly decreased. The maturity scale of inter - bank certificates of deposit in April is about 2.94 trillion yuan, a year - on - year increase of 0.46 trillion yuan and a month - on - month decrease of 0.65 trillion yuan [8]. 3. Institutional Behavior - **Leverage Ratio**: From March 23 - 27, 2026, the average leverage ratio of the inter - bank bond market was 107.14%, down from 107.32% in March 16 - 20 [9]. - **Duration of Bond Funds**: On March 27, 2026, the median duration (MA5) of medium - and long - term interest - rate pure bond funds decreased by 0.04 years week - on - week to 4.26 years, and the median duration (MA5) of short - term interest - rate pure bond funds increased by 0.06 years week - on - week to 2.00 years [9].

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - Since 2026, banks have been the main buyers of treasury bonds within 10 years and inter - bank certificates of deposit in the secondary market. Public funds are currently cautious, with low durations and a decreasing proportion of interest - rate purchases [1]. - The bank's liability side remains stable, supported by the growth of non - financial enterprises and non - banking institutions' deposits, while there is a certain loss of household deposits. The strong stock market performance has also promoted the growth of non - banking deposits [2]. - Although strengthening inter - bank self - discipline is beneficial for banks in the long - term, in the short - term, the partial loss of inter - bank deposits and the decline in liability stability may affect banks' asset - side behavior [3]. - There is uncertainty about whether non - banks can take over from banks to continue bullish operations. Non - banks are more cautious due to many disturbing factors, and the market rhythm and direction may change. Although non - banks have limited short - selling chips and there are opportunities for bullish band operations, the increasing supply in the primary market requires caution in April [4]. 3. Summary by Directory 3.1 Non - banks to Take Over from Banks: Continue to Go Long? 3.1.1 Most Funds are Cautious, and Banks Become the Market Main Force - In 2026, banks are the main buyers of treasury bonds within 10 years and inter - bank certificates of deposit in the secondary market. Large - scale banks have a cumulative net purchase of 6450.9 billion yuan in treasury bonds and 2400.7 billion yuan in certificates of deposit in the secondary market. Small and medium - sized banks mainly buy policy financial bonds within 10 years, treasury bonds over 20 years, and more than 1 trillion yuan of inter - bank certificates of deposit [14]. - Banks also have a large amount of primary - market bond underwriting. The strong correlation between the primary - market issuance of 50 - year treasury bonds and banks' secondary - market sales indicates that the net secondary - market purchases underestimate banks' actual buying power [15]. - Public funds are currently cautious. Since early March, due to the unstable Middle - East situation, the market has gradually reduced durations, which have returned to the level before the Spring Festival. The trading enthusiasm of public funds in 10 - year and 30 - year treasury bonds has declined, and banks have become a stabilizing force in the market [17][19]. 3.1.2 The Stability of Banks' Liability Side Exceeds Expectations - Although there were concerns about the loss of time deposits in the first half of 2026, the bank's liability system remains stable. From December 2025 to January 2026, the year - on - year deposit growth rate of large - scale banks increased significantly, partly due to actual deposit growth and partly due to the low - base effect caused by the loss of non - bank inter - bank deposits [22]. - In terms of new deposits, non - financial enterprises and non - banking institutions are the main growth drivers, while household deposits have a certain loss. From January to February, household deposits increased less by 890 billion yuan, non - financial enterprises increased more by 1055.5 billion yuan, fiscal deposits increased less by 390 billion yuan, and non - banking financial institutions increased more by 1120 billion yuan, with a total net increase of 520 billion yuan [29]. - Large - scale banks' deposit attractiveness has marginally increased. In January and February, the new household deposits of small and medium - sized banks were relatively low, while large - scale banks performed better. In terms of enterprise deposits, large - scale banks also showed better performance [30]. - The strong stock market performance has promoted the growth of non - bank deposits. Historically, non - bank deposits are strongly correlated with stock market performance. From December 2025 to February 2026, the good stock market performance drove the growth of banks' non - bank deposits [35]. 3.1.3 Will Banks' Buying Power Weaken? - Media reports suggest that the self - discipline management of inter - bank deposit interest rates is being further strengthened. According to the new requirements, the proportion of inter - bank current deposits with an interest rate higher than 1.4% of the 7 - day reverse repurchase (OMO) policy rate should not exceed 10% - 20% at the end of the quarter [37]. - The record - high bank deposit - loan gap may reflect the increasing pressure on banks' interest spreads. As of February 2026, the deposit - loan gap of financial institutions reached a record high. In the long - term, strengthening inter - bank self - discipline is beneficial for reducing banks' liability costs and stabilizing net interest spreads. However, in the short - term, the partial loss of inter - bank deposits and the decline in liability stability may affect banks' asset - side behavior [38][45]. - Large - scale banks have abundant funds at the beginning of the year. They conduct short - term reverse repurchases and buy certificates of deposit. They also buy a large amount of treasury bonds in the secondary market, which has been an important factor driving down the bond market. However, the impact of strengthened inter - bank supervision on banks' liability sides remains to be seen. Non - banks are more cautious, and the market rhythm and direction may change. Although non - banks have limited short - selling chips and there are opportunities for bullish band operations, the increasing supply in the primary market requires caution in April [57]. 3.2 Market Review: Many Overseas Disturbances - Geopolitical conflicts have affected the bond market. On March 23, 2026, due to the expected escalation of geopolitical conflicts, the bond market was under pressure. After that, news about the US - Iran situation and the central bank's MLF operation also affected the bond market. This week, the 10 - year treasury bond yield decreased by 1.4 BP, and the 30 - year treasury bond yield decreased by 1.65 BP [59][60][61]. 3.3 High - Frequency Tracking: Rising Oil Prices, High Probability of PPI Turning Positive in March 3.3.1 Price Index: Rising Oil Prices, High Probability of PPI Turning Positive - Consumer prices: Pork prices continue to decline, while fruit and vegetable prices are stable. - Producer prices: Oil prices continue to rise. Based on the prices of five commodities in March, the year - on - year PPI in March is expected to turn positive, with an expected value of 2.39%, and the PPI for means of production is expected to be 3.39% [63][64]. 3.3.2 Production: Relatively Stable The production indicators such as crude steel daily output, key power plant coal consumption, PX operating rate, and steel enterprise blast furnace operating rate show relatively stable production [86][87]. 3.3.3 Consumption: Still Weak - Liquor prices are flat, automobile consumption has slightly recovered, and postal express volume is slightly higher than the same period [95]. 3.3.4 Investment: Still Weak Overall - Real estate: There is a certain "spring market" in the second - hand housing market, but land transfer remains weak. - Infrastructure: Asphalt and cement production are at relatively low levels [104]. 3.3.5 Imports and Exports: Rising Freight Rates The freight rates for imports and exports are rising [108]. 3.3.6 Inventory: Marginal Decline in Rebar and Copper The inventories of rebar and copper are showing a marginal decline [114]. 3.3.7 Transportation: At a High Level in the Same Period The coastal container freight rate index and other transportation - related indicators are at a high level compared to the same period [118].

1. Report Industry Investment Rating No information provided in the content. 2. Core Views of the Report - The market anticipates regulatory adjustments to the inter - bank certificate of deposit (CD) quota management method, potentially integrating it with other financial bond quotas. If implemented, the bank's liability - side financing structure may adjust, with a long - term trend of reduced CD supply and a short - term possibility of some banks increasing CD issuance [2]. - The bond market's trading theme may shift back to marginal changes in the domestic liquidity environment. With the central bank's continuous support for liquidity and the fading of cross - quarter factors, the bond market may enter a phased "buying window." The next potential disruptions are the April tax period and the issuance of ultra - long - term special treasury bonds [2][90]. - In terms of strategy, it is recommended to moderately increase the aggressiveness of the portfolio, maintain a portfolio duration of 3 - 5 years, and appropriately increase trading positions in long - term and ultra - long - term bonds. Specific bond varieties such as 250003 and 260003 are recommended, and trading opportunities for 250016, 250022, and 260005 can be noted [2][90]. 3. Summary by Relevant Catalogs 3.1 Important Matters - On March 25, 2026, the central bank conducted 500 billion yuan of 1 - year MLF operations, with a net injection of 5 billion yuan. As of March 2026, MLF has achieved net injections for 13 consecutive months [5]. - On March 27, 2026, the central bank held a financial stability work meeting, emphasizing the need to prevent and resolve systemic financial risks, dispose of key - area financial risks, and strengthen the financial stability guarantee system [9]. 3.2 Money Market 3.2.1 Open Market Operations and Fund Rate Trends - From March 23 to March 27, 2026, the central bank conducted 7 - day reverse repurchase operations, injecting a total of 474.2 billion yuan, with 242.3 billion yuan maturing, resulting in a net injection of 231.9 billion yuan. From March 30 to April 3, 2026, it is expected that 474.2 billion yuan of base currency will be matured and withdrawn [10][11]. - As the cross - quarter period approached last week, the funding situation tightened marginally, with R007 rising above 1.5%. As of March 27, 2026, R001, R007, DR001, and DR007 were 1.387%, 1.507%, 1.318%, and 1.440% respectively, with changes of - 0.90BP, 3.00BP, - 0.28BP, and 1.89BP compared to the close on March 23 [16]. 3.2.2 CD Rate Trends and Repurchase Transaction Situations - In the primary market, last week's inter - bank CD issuance volume was 772.02 billion yuan, with a net financing volume of 73.82 billion yuan. The CD issuance volume of city commercial banks was the largest, with a net financing volume of 47.6 billion yuan. The issuance rates of inter - bank CDs of various banks decreased compared to the previous week [21][23][25]. - In the secondary market, affected by the approaching quarter - end, the overall yield of inter - bank CDs increased. The yield of AAA - rated 1 - month inter - bank CDs decreased by 3.00BP to 1.43%, while the yields of 3 - month, 6 - month, 9 - month, and 1 - year inter - bank CDs increased [27]. 3.3 Bond Market 3.3.1 Primary Market - Last week, 97 interest - rate bonds were issued, with an actual issuance amount of 664.559 billion yuan, a maturity amount of 405.651 billion yuan, and a net financing amount of 258.907 billion yuan. In March 2026, the issuance pace of treasury bonds was slightly behind that of local bonds, but the issuance scales of both were higher than the average levels of the same period from 2022 - 2025 [30]. - As of March 27, 2026, the cumulative net financing scale of special refinancing bonds in 2026 reached 950 billion yuan, mainly in long - term and ultra - long - term tenors. Regions with relatively large issuance scales include Jiangsu, Henan, Sichuan, Inner Mongolia, and Zhejiang [40]. 3.3.2 Secondary Market - Last week, in a weak equity market, long - term bonds performed better overall, and the 10 - 1 - year treasury bond term spread narrowed. The turnover rate of the 10 - year treasury bond active bond increased, while that of the 10 - year CDB bond active bond (250220) decreased [30][44][47]. - The 10 - 1 - year treasury bond term spread reached 56.54BP, and the 30 - 1 - year treasury bond term spread widened to 109.79BP. The spreads between long - term local bonds and long - term treasury bonds and between ultra - long - term local bonds and ultra - long - term treasury bonds widened overall last week [57][59]. 3.4 Institutional Behavior Tracking - Last week, the overall scale of leveraged trading decreased as the quarter - end approached, with an average of about 794 billion yuan. In the cash bond market, large banks became net sellers, small and medium - sized banks adjusted their bond - holding structures, insurance companies' overall buying strength declined marginally, securities firms' selling scale decreased, and funds continued to prefer policy - based financial bonds [63][74]. - In February 2026, the leverage ratio of all institutions in the inter - bank market was about 118.41%, a decrease of about 0.89 percentage points compared to January 2026. The leverage ratios of commercial banks, securities firms, and other institutions in the inter - bank market were about 110.72%, 189.40%, and 130.57% respectively [63]. 3.5 High - Frequency Data Tracking - Last week, the settlement price of rebar futures decreased by 0.58% week - on - week, the settlement price of wire rod futures remained flat, the settlement price of cathode copper futures increased by 1.22% week - on - week, the cement price index increased by 0.91% week - on - week, and the Nanhua Glass Index decreased by 1.67% week - on - week [88]. - The CCFI index increased by 1.64% week - on - week, and the BDI index decreased by 1.22% week - on - week. The wholesale price of pork decreased by 1.56% week - on - week, and the wholesale price of vegetables decreased by 1.85% week - on - week. The settlement prices of Brent crude oil futures and WTI crude oil futures decreased by 3.73% and 3.91% respectively week - on - week. The central parity rate of the US dollar against the RMB was 6.91 [88][89]. 3.6 Market Outlook - Looking ahead, the inflation trading driven by geopolitical conflicts is gradually cooling down, and the bond market's trading theme may return to marginal changes in the domestic liquidity environment. With the central bank's continuous support for liquidity and the fading of cross - quarter factors, the bond market may enter a phased "buying window." Attention should be paid to the April tax period and the issuance pace of ultra - long - term special treasury bonds [2][90]. - In terms of strategy, it is recommended to moderately increase the aggressiveness of the portfolio, maintain a portfolio duration of 3 - 5 years, and appropriately increase trading positions in long - term and ultra - long - term bonds. Specific bond varieties such as 250003 and 260003 are recommended, and trading opportunities for 250016, 250022, and 260005 can be noted [2][90].