1. Report Industry Investment Rating There is no information about the report industry investment rating in the provided content. 2. Core Viewpoints of the Report - The fiscal data from January to February 2026 shows that non - tax revenue turned positive year - on - year, and fiscal expenditure was front - loaded, which supported the unexpected growth of economic data to some extent [4][5]. - The government will continue to implement a more proactive fiscal policy in 2026, mainly reflected in ensuring fiscal expenditure, optimizing the combination of government bond tools, improving the efficiency of transfer payment funds, optimizing the expenditure structure, and strengthening fiscal - financial coordination [5]. - It is expected that the target range of the 10 - year treasury bond is 2 - 3%, with a central value of 2.5% [7]. 3. Summary by Relevant Catalogs 3.1 1 - 2 Month Fiscal Data Concerns - Tax revenue increased by 0.1% year - on - year, and the growth rate decreased by 0.7 pct compared with the previous value. The better - than - expected import and export data in January and February may be the main reason for the year - on - year growth of tax revenue. The securities transaction stamp duty increased by 110.0% year - on - year. Non - tax revenue increased by 3.4% year - on - year, turning from negative to positive, driven by local governments' continuous activation of state - owned assets [4]. - Government fund revenue decreased by 16.0% year - on - year in January and February. Land transfer revenue decreased by 25.2% year - on - year, further dragging down government fund revenue. The decline of land transfer revenue directly led to the contraction of overall fund revenue, and the ebb of land finance may continue to drag down government fund revenue [4]. 3.2 General Public Budget - **Income**: From January to February, general public budget income increased by 0.7% year - on - year. Central income decreased by 1.7% year - on - year, and local income increased by 2.6% year - on - year. Tax revenues such as domestic value - added tax, import - link value - added tax and consumption tax, etc., increased compared with December 2025. Non - tax revenue turned positive, with a year - on - year increase of 3.4% [6]. - **Expenditure**: From January to February, general public budget expenditure increased by 3.6% year - on - year. Central expenditure increased by 4.5% year - on - year, and local expenditure increased by 3.5% year - on - year. The year - on - year growth rate of fiscal expenditure rebounded compared with December [6]. 3.3 Governmental Fund Budget - **Income**: From January to February, government fund income decreased by 16.0% year - on - year. Central income increased by 6.7% year - on - year, and local income decreased by 19.2% year - on - year. Land transfer income decreased by 25.2% year - on - year [7]. - **Expenditure**: From January to February, government fund expenditure increased by 16.0% year - on - year. Central expenditure increased by 8.0% year - on - year, and local expenditure increased by 16.3% year - on - year. Land transfer expenditure decreased by 1.9% year - on - year. The growth rate of government fund expenditure in January and February increased compared with the previous value [7]. 3.4 Bond Market Views - **Fundamentals**: The falsification of the under - expected economic recovery, combined with the possible broad credit and broad fiscal policies at the beginning of 2026, will accelerate the cyclical recovery [7]. - **Broad money**: If there are broad monetary policies (such as reserve requirement ratio cuts, interest rate cuts, bond purchases, etc.), similar to 2025, yields may decline briefly and then rise [7]. - **Inflation**: It is expected that inflation will pick up, and attention should be paid to whether the month - on - month PPI can remain positive [7]. - **Funding rate**: If the month - on - month inflation continues to rise, there is a possibility of tightening funds, and the yields of short - term bonds will also start to rise [7]. - **Real estate**: Real estate is not the main means of stabilizing growth this time. Similar to the situation in the United States after 2008, real estate is a lagging indicator. Real estate may bottom out after the recovery of various economic indicators and the rise of the stock market [7]. - **Bonds**: It is expected that the target range of the 10 - year treasury bond is 2 - 3%, with a central value of 2.5% [7].

1. Report Industry Investment Rating - Not provided in the given content 2. Core View of the Report - The report tracks the supply and trading of local government bonds, including the rhythm of primary supply and characteristics of secondary trading, to provide an overview of the local government bond market [3][4] 3. Summary by Relevant Catalogs 3.1 Primary Supply Rhythm - Last week (March 9 - 13, 2026), local government bonds issued a total of 135.544 billion yuan, including 17.734 billion yuan in new special bonds and 43.159 billion yuan in refinancing special bonds. "Repaying local bonds" and "special new special bonds" are the main investment areas for special bond funds [3][10] - As of now, about 238.582 billion yuan of special refinancing special bonds have been issued in March, accounting for 25.75% of the local bond issuance scale for the month [3][10] - In terms of issuance pricing, the issuance interest rates of 10 - year, 20 - year, and 30 - year local bonds increased by 2.2BP, 1.2BP, and 1.6BP respectively. The spread between new bonds over 20 years and the same - term treasury bonds significantly compressed, with a decline of over 3BP, especially for the 30 - year variety, where the spread dropped to 16.9BP, similar to the level in late January [3][15] - In March, Guangdong and Inner Mongolia were the main regions for local bond issuance. Among regions with large issuance scales, newly issued bonds in Fujian are basically over 10 years, and the issuance scale of 20 - 30 - year varieties in Guangdong and Fujian exceeded 20 billion yuan. Notably, the local bond issuance interest rates in Inner Mongolia and Fujian reached 2.32% and 2.39% respectively [3][17] 3.2 Secondary Trading Characteristics - 7 - 10 - year local bonds are relatively resistant to decline. Last week, the 7 - 10 - year and over 10 - year local bond indexes fell by 0.07% and 0.28% respectively. The decline of 7 - 10 - year varieties was slightly less than that of the same - term treasury bonds and credit bonds. The inflation expectation increase led to a significant rise in ultra - long - term interest rates, and the decline of over 10 - year treasury bonds reached 1.32%, far exceeding other bond types and terms. In addition, high - grade ultra - long - term credit bonds still showed positive cumulative returns in the past four weeks [4][21] - The trading activity of local bonds increased. In terms of provinces, the trading volume of government bonds in Guangdong, Hunan and other places was relatively high. Moreover, the trading term of local bonds significantly lengthened. The average trading term in Hunan, Hebei and other provinces was over 25 years, and the trading yield exceeded 2.4% [4][21]

1. Report Industry Investment Rating There is no information provided in the content about the report's industry investment rating. 2. Core Viewpoints of the Report - The macro - policy in 2026 emphasizes expanding domestic demand, with a focus on boosting consumption and investment, optimizing traditional industries, and fostering emerging and future industries. Fiscal and monetary policies are coordinated to support economic growth, while financial supervision and real - estate policies aim to maintain stability and prevent risks. The international trade situation is affected by the US tariff policy changes [1][2][3]. 3. Summary According to the Directory 3.1 Macro - tone: Expand Domestic Demand First, Support Investment and Optimize Consumption - **Consumption**: The government emphasizes building a strong domestic market, implementing a special consumption - boosting action. It allocates 250 billion yuan in ultra - long - term special treasury bonds for consumer goods trade - in and 100 billion yuan in fiscal - financial cooperation policies to promote domestic demand, with greater intensity than last year [1][11]. - **Investment**: The government aims to fully tap and release effective investment potential, stimulate private investment, and increase the scale of new policy - based financial instruments to 800 billion yuan to drive more social capital into investment. The investment in "Six Networks" and key areas in 2026 will exceed 7 trillion yuan [12]. - **Industry**: Traditional industries are optimized and upgraded with 200 billion yuan in ultra - long - term special treasury bonds for large - scale equipment renewal. Emerging and future industries such as integrated circuits and quantum technology are to be cultivated and expanded, with the related output value of six new industries expected to double or more by 2030 [13]. - **Technological Innovation**: The government attaches more importance to technological innovation, and more supporting policies may be introduced in the future [13]. - **Reform**: The focus of reform is adjusted, with the construction of a unified national market and fiscal - financial system reform given higher priority [14]. 3.2 Fiscal Policy: Ultra - long Bonds and Quasi - fiscal Tools Actively Contribute, and the Expenditure Structure is More Optimized - **Policy Tone**: The active fiscal policy continues, with fiscal expenditure maintaining scale and optimizing the structure. The deficit rate is set at about 4%, and the deficit scale is 5.89 trillion yuan, an increase of 230 billion yuan from last year [17]. - **Special Treasury Bonds**: The ultra - long - term special treasury bonds remain at 1.3 trillion yuan, with 800 billion for "Two Important" projects and 500 billion for "Two New" policies. The special treasury bonds for supplementing the capital of large - scale commercial banks are reduced to 300 billion yuan [18]. - **New Special Bonds**: The scale of new local government special bonds remains at 4.4 trillion yuan, and the report proposes to improve the management of the negative list of special bond projects and the self - review and self - issuance pilot [19]. - **New Policy - based Financial Tools**: The scale increases to 80 billion yuan, which can effectively supplement the capital of major projects, and the capital injection may be earlier than last year [20]. - **Fiscal - Financial Cooperation to Promote Domestic Demand**: The scale is 10 billion yuan, focusing on supporting private investment and household consumption [23]. - **Debt Resolution**: The risk resolution of local government financing platform debts has achieved important phased results. By the end of 2025, compared with the beginning of 2023, the number of financing platforms and the debt scale have both decreased by more than 70% [21]. 3.3 Monetary Policy: Cost Reduction Focuses on "Intermediate Fees", and Overall Easing Still Needs to Wait - **Policy Tone**: The "moderately loose" monetary policy continues, and the probability of short - term reserve requirement ratio cuts and interest rate cuts is limited. The central bank focuses on reducing intermediate fees in credit financing [24]. - **Financial Risk**: The 10 - year treasury bond yield stabilizes around 1.8%, and the central bank is studying a liquidity support mechanism for non - bank institutions in specific situations and supports the Central Huijin Company to play a role similar to a "stabilization fund" [25]. - **Exchange Rate**: The central bank lowers the foreign exchange risk reserve ratio for forward foreign exchange sales, indicating that the RMB exchange rate against the US dollar is in the median range in recent years, and the central bank has no intention to guide the RMB to depreciate [26]. - **Monetary Policy Report**: It proposes to view the total liquidity from the combined perspective of asset management products and bank deposits [27]. - **Central Bank Bond Purchases**: The scale is reduced to 50 billion yuan, indicating a relatively cautious attitude [28]. 3.4 Financial Supervision: Coordinate Risk Prevention and Development, and Firmly Hold the Safety Bottom Line - **Policy Tone**: Continue to emphasize the prevention of risks in key areas, and details are more focused on risk resolution [31]. - **Capital Market Reform**: Deepen the reform of the Growth Enterprise Market and optimize the refinancing mechanism to better serve technological innovation and the development of new - quality productivity [32]. - **Financial Risk**: The number of high - risk small and medium - sized financial institutions has been significantly reduced, and capital replenishment methods are expected to be gradually expanded [33]. - **Inter - bank Current Deposits**: The self - regulatory management of inter - bank current deposits has become stricter, with the scope expanded and a quarterly ratio limit introduced [34]. 3.5 Real - estate Policy: Focus on Stabilizing the Market, Centering on "Controlling Increment, Reducing Inventory, and Optimizing Supply" - **Policy Tone**: The regulatory tone in 2026 changes from "promoting the market to stop falling and stabilize" to "focusing on stabilizing the market", with a focus on "controlling increment, reducing inventory, and optimizing supply", and a new proposal to deepen the reform of the housing provident fund system [37]. - **Local Policies**: Shanghai issues the "Shanghai Seven - Point Plan", and Jiangsu, Chongqing, and Shenzhen optimize real - estate market policies [38]. - **Land Supply**: The total amount of construction land is controlled during the planning period, and the importance of revitalizing the stock is further enhanced [39]. 3.6 Sino - US Tariffs: The Supreme Court Rules the Counter - tariff Policy Invalid, and Alternative Measures are Successively Introduced - **Counter - tariff Policy**: The US Supreme Court rules that the counter - tariff policy implemented by the Trump administration lacks clear legal authorization [42]. - **Alternative Measures**: Trump announces an additional 10% import tariff on global goods, which is later raised to 15%. The US also announces a new round of "301 investigations" on 16 major trading partners, and China and the US are to hold the 6th round of economic and trade consultations [42][43].

Fiscal Overview - The net financing of government debt in 2026 is projected to be CNY 11.89 trillion, an increase of CNY 300 billion from 2025, while its proportion to GDP is expected to decrease from 8.5% to 8.1%[13] - The overall budget expenditure growth rate is set at 4.8%, with actual spending growth likely to exceed 5% after excluding debt repayment and bank injections[13] Expenditure Structure - The general public budget expenditure is expected to grow by 4.4% in 2026, an increase of 3.4 percentage points from 2025, with significant increases in science and technology (7.1%), foreign defense (7.0%), and social security and employment (6.0%)[2] - New special bonds will focus on major project support, indicating a stronger emphasis on infrastructure and development projects compared to 2025[2] Policy Direction - The core directive of the 2026 fiscal policy remains on expanding domestic demand, shifting from simple funding to a collaborative fiscal-financial model[18] - A total of CNY 250 billion is allocated for the "old-for-new" policy to stabilize consumer spending, while CNY 8 trillion in new policy financial tools will be introduced to leverage social capital[18] Revenue Challenges - Land use rights revenue is projected to decline by 52.3% from its peak in 2021, significantly impacting fiscal stability[3] - The overall tax burden in China ranks 36th among 38 major economies, indicating a need for structural reform to enhance revenue stability[3] Reform Initiatives - The government plans to increase the proportion of state capital revenue contributions, with state capital operating budget revenue growing by CNY 175.5 billion in 2025[4] - The introduction of zero-based budgeting and the reduction of "three public" expenditures by over 7% are key measures to improve fiscal efficiency[4]

1. Report Industry Investment Rating No information about the industry investment rating is provided in the report. 2. Core View of the Report - The issuance and net financing of local government bonds increased this period but are expected to decline next period. The current 10Y and above local government bonds still have certain cost - effectiveness, but the potential pressure of increased bond supply after the Two Sessions should be vigilant [2]. 3. Summary According to the Table of Contents 3.1 This period, the issuance volume of local government bonds increased, and the weighted issuance term shortened - The total issuance/net financing of local government bonds this period (2026.3.2 - 2026.3.8) was 2724.84 billion yuan/2562.29 billion yuan (2564.20 billion yuan/1894.23 billion yuan in the previous period), and the expected issuance/net financing next period (2026.3.9 - 2026.3.15) is 1355.45 billion yuan/632.14 billion yuan [2][6]. - The weighted issuance term of local government bonds this period was 17.95 years, shorter than 21.76 years in the previous period [2][8]. - The issuance spreads of 10/30 - year local government bonds compared with the same - term national bonds increased to 17.45BP/decreased to 21.00BP this period (12.09/23.46BP in the previous period), and the full - field multiples increased [2][9]. - Compared with the same period in 2024 and 2025, the issuance progress of new general bonds this year is slower, but the issuance progress of new special bonds is faster. As of March 6, 2026, the cumulative issuance of new general bonds/new special bonds accounted for 26.9% and 20.5% of the annual quota respectively, and considering the expected issuance next period, it will be 29.3% and 20.9% [2][10][12]. - The planned issuance scale of local government bonds in March 2026 is 936.2 billion yuan, of which new special bonds are 302.7 billion yuan. As of March 6, 2026, 24 regions have disclosed the planned issuance scale of local government bonds in March 2026, with new special bonds of 302.7 billion yuan [2][20][21]. - This period, the special new special bonds issued 5.6 billion yuan, and the special refinancing bonds for replacing hidden debts and repaying existing debts issued 112.6 billion yuan and 0 billion yuan respectively. As of March 6, 2026, the cumulative issuance of special new special bonds in 2026 was 105.5 billion yuan; the cumulative issuance of special refinancing bonds for replacing hidden debts was 792.3 billion yuan, with an issuance progress of 39.6%; the cumulative issuance of special refinancing bonds for repaying existing debts was 3.6 billion yuan [2][15][16]. 3.2 This period, the spread between local government bonds and national bonds narrowed for 10Y and widened for 30Y, and the weekly turnover rate increased significantly - As of March 6, 2026, the spreads between 10 - year and 30 - year local government bonds and national bonds were 19.90BP and 20.88BP respectively, narrowing by 2.57BP and 0.14BP compared with February 28, 2026, and were at the 52.60% and 80.00% historical quantiles since 2023 respectively [2][23][27]. - The weekly turnover rate of local government bonds this period was 1.10%, a significant increase compared with 0.42% in the previous period [2][33]. - This period, the yields and liquidity of 7 - 10Y local government bonds in regions such as Qinghai, Heilongjiang, and Jilin were better than the national average [2].

1. Report Industry Investment Rating No relevant content provided. 2. Core View of the Report - The issuance and net financing of local government bonds in the current period increased compared to the previous period, but it is expected to decline in the next period. The weighted issuance term of local government bonds in the current period is shortened. The issuance spreads of 10/30-year local government bonds compared to the same-term national bonds changed, and the full - field multiples increased. [2] - Compared with the same period in 2024 and 2025, the issuance progress of new general bonds this year is slower, while the issuance progress of new special bonds is faster. [2] - The planned issuance scale of local government bonds in March 2026 is 936.2 billion yuan, with new special bonds accounting for 302.7 billion yuan. [2] - The special new special bonds issued in the current period are 560 million yuan, and the special refinancing bonds for replacing hidden debts and repaying existing debts are 11.26 billion yuan and 0 yuan respectively. [2] - The spread between local government bonds and national bonds narrowed for 10Y and widened for 30Y, and the weekly turnover rate increased significantly. [2] - Currently, local government bonds with a term of 10Y and above still have certain cost - effectiveness, but the potential pressure of increased bond supply after the Two Sessions should be vigilant. [2] 3. Summary According to the Directory 3.1 This Period: Local Government Bond Issuance Increased and the Weighted Issuance Term Shortened - The total issuance of local government bonds in the current period (March 2 - 8, 2026) is 272.484 billion yuan (256.420 billion yuan in the previous period), and the expected issuance in the next period (March 9 - 15, 2026) is 135.545 billion yuan. The weighted issuance term of local government bonds in the current period is 17.95 years, shorter than 21.76 years in the previous period. [2][9] - The issuance spreads of 10/30 - year local government bonds compared to the same - term national bonds in the current period increased to 17.45BP/decreased to 21.00BP, and the full - field multiples increased compared to the previous period. [2][12] - As of March 6, 2026, the cumulative issuance of new general bonds/new special bonds accounted for 26.9% and 20.5% of the annual quota respectively, and considering the expected issuance in the next period, it will be 29.3% and 20.9%. Compared with the same period in 2024 and 2025, the issuance progress of new general bonds is slower, while that of new special bonds is faster. [2][16] - As of March 6, 2026, 24 regions have disclosed that the planned issuance scale of local government bonds in March 2026 is 936.2 billion yuan, including 302.7 billion yuan of new special bonds. [2][22] - The special new special bonds issued in the current period are 560 million yuan, and the cumulative issuance in 2026 is 10.55 billion yuan; the special refinancing bonds for replacing hidden debts have a cumulative issuance of 79.23 billion yuan, with a progress of 39.6%; the special refinancing bonds for repaying existing debts have a cumulative issuance of 360 million yuan. [2][18] 3.2 This Period: The Spread between Local Government Bonds and National Bonds Narrowed for 10Y and Widened for 30Y, and the Weekly Turnover Rate Increased Significantly - As of March 6, 2026, the spreads between 10 - year and 30 - year local government bonds and national bonds are 19.90BP and 20.88BP respectively, narrowing by 2.57BP and 0.14BP compared to February 28, 2026, and are at the 52.60% and 80.00% historical quantiles since 2023. [2][33] - The weekly turnover rate of local government bonds in the current period is 1.10%, a significant increase compared to 0.42% in the previous period. The yields and liquidity of 7 - 10Y local government bonds in regions such as Qinghai, Heilongjiang, and Jilin are better than the national average. [2][37]

1. Report Industry Investment Rating No information provided in the given content. 2. Core Viewpoints of the Report - The issuance and net financing of local government bonds in the current period decreased compared to the previous period, and it is expected to increase in the next period. The issuance/ net financing in the current period (2026.2.23 - 2026.3.1) was 2564.20 billion yuan/ 1894.23 billion yuan, and the expected issuance/ net financing in the next period (2026.3.2 - 2026.3.8) is 2724.84 billion yuan/ 2562.29 billion yuan [2]. - The issuance progress of new - added local government bonds in 2026 is relatively fast. As of February 27, 2026, the cumulative issuance of new - added general bonds/ new - added special bonds accounted for 26.3% and 18.7% of the annual quota (calculated based on the 2025 quota), and considering the expected issuance in the next period, it will be 26.9% and 20.5% [2]. - The weighted issuance term of local government bonds in the current period has been extended, and the issuance spreads of 10 - year and 30 - year local government bonds compared to the same - term national bonds have changed, with the full - field multiples decreasing [2]. - The spread between local government bonds and national bonds for 10 - year and 30 - year terms has changed, with the 10 - year spread widening and the 30 - year spread narrowing slightly, and the weekly turnover rate has decreased significantly [2]. - Currently, local government bonds with a term of 10 years and above still have certain cost - effectiveness [2]. 3. Summary According to Relevant Catalogs 3.1 This Period's Local Government Bond Issuance Volume Decreased, and the Weighted Issuance Term was Extended - The total issuance of local government bonds in the current period was 2564.20 billion yuan (2026.2.23 - 2026.3.1), compared with 3221.36 billion yuan in the previous period. The expected issuance in the next period is 2724.84 billion yuan [2][6]. - The weighted issuance term of local government bonds in the current period was 21.76 years, significantly longer than the 15.48 years in the previous period [2][8]. - The issuance spreads of 10 - year and 30 - year local government bonds compared to the same - term national bonds decreased to 12.09BP and increased to 23.46BP respectively, and the full - field multiples decreased compared to the previous period [2][9]. 3.2 Issuance Progress of New - Added Local Government Bonds - As of February 27, 2026, the cumulative issuance of new - added general bonds accounted for 26.3% of the annual quota, and considering the expected issuance in the next period, it will be 26.9%. The cumulative issuance of new - added special bonds accounted for 18.7% of the annual quota, and considering the expected issuance in the next period, it will be 20.5% [2][12][15]. 3.3 Special Local Government Bond Issuance - In the current period, the issuance of special new - added special bonds was 53 billion yuan. The special refinancing bonds for replacing hidden debts and repaying existing debts were issued at 934 billion yuan and 0 billion yuan respectively. As of February 27, 2026, the cumulative issuance of special new - added special bonds in 2026 was 999 billion yuan; the cumulative issuance of special refinancing bonds for replacing hidden debts was 6797 billion yuan, with an issuance progress of 34.0%; the cumulative issuance of special refinancing bonds for repaying existing debts was 36 billion yuan [2][19][20]. 3.4 March 2026 Local Government Bond Issuance Plan - As of February 27, 2026, 24 regions have disclosed that the total planned issuance of local government bonds in March 2026 is 9347 billion yuan, including 3067 billion yuan of new - added special bonds [2][21][22]. 3.5 Spread and Turnover Rate of Local Government Bonds - As of February 27, 2026, the spreads between 10 - year and 30 - year local government bonds and national bonds were 22.47BP and 20.74BP respectively, with the 10 - year spread widening by 3.46BP and the 30 - year spread narrowing by 0.66BP compared to February 14, 2026 [2][28][29]. - The weekly turnover rate of local government bonds in the current period was 0.42%, a significant decrease compared to the previous period's 1.08% [2][35].

Core Viewpoint - The issuance of government bonds, including national and local government special bonds, has accelerated, reflecting a proactive fiscal approach aimed at stabilizing growth, investment, and expectations in 2026 [1] Group 1: Government Bond Issuance - The total scale of issued national bonds and new special bonds in 2026 has increased by 12% and 60% year-on-year, respectively [1] - The first quarter of 2026 has seen an earlier pace of government bond issuance, indicating a trend of fiscal preemptive action [1] Group 2: Policy Implications - The acceleration in bond issuance is aligned with policy goals of stabilizing growth, investment, and expectations [1] - To enhance the pricing function of national bonds, it is suggested to improve the maturity structure of bonds and optimize the buying and selling mechanisms [1] - The role of national bonds in regulating the money supply should be effectively utilized [1]

Core Viewpoint - The issuance of government bonds, including national and local special bonds, has accelerated, reflecting a proactive fiscal approach aimed at stabilizing growth, investment, and expectations in 2026 [1][2]. Group 1: Government Bond Issuance - The total scale of national bonds issued by February 26, 2026, reached 22,390 billion, a 12% increase compared to 19,960.6 billion in the same period of 2025 [1]. - The issuance of 10-year and 3-year bonds on February 24, 2026, amounted to 1,350 billion and 1,300 billion respectively, followed by 1,200 billion for 5-year bonds and 400 billion for discount bonds on February 25, 2026 [1]. - The issuance of long-term special bonds is expected to increase in 2026 to meet the funding needs of major projects under the "14th Five-Year Plan" [2]. Group 2: Market Stability and Expectations - The single issuance scale of national bonds has expanded, with 1-year, 2-year, 7-year, and 10-year bonds issued in January 2026 being 1,350 billion, 1,750 billion, 1,600 billion, and 1,800 billion respectively, compared to lower figures in January 2025 [2]. - Increasing the issuance scale of 10-year bonds is seen as beneficial for enhancing liquidity and fulfilling the pricing function of government bonds [2][3]. - The expansion of single bond issuance is linked to the refinancing needs due to high maturity scales, indicating a responsive approach to market conditions [3]. Group 3: Special Bonds and Infrastructure Investment - As of February 26, 2026, local governments issued 8,076.86 billion in new special bonds, a 60% increase from 5,040.75 billion in 2025 [4]. - The primary uses of newly issued special bonds include municipal and industrial park infrastructure, transportation infrastructure, and affordable housing projects [4]. - The management mechanism under the "negative list" is expected to broaden the scope of special bond applications, aligning with the demands for technological innovation and modern industrial system construction [4].

1. Report's Investment Rating for the Industry No information provided in the content. 2. Core View of the Report The report tracks the supply and trading of local government bonds, covering the issuance rhythm, pricing, regional differences in the primary market, and trading characteristics in the secondary market. It shows that the issuance and trading of local government bonds have certain regional characteristics, and their performance in the secondary market lags behind that of treasury bonds and high - grade credit bonds [3][4]. 3. Summary According to the Directory 3.1 Primary Supply Rhythm - During the week before the festival (2026.2.9 - 2026.2.13), local government bonds issued a total of 322.136 billion yuan, including 195.074 billion yuan of new special bonds and 44.645 billion yuan of refinancing special bonds. The main investment areas of special bond funds are "ordinary/project income" and "replacing implicit debts". As of now, about 429.07 billion yuan of special refinancing special bonds have been issued in February, accounting for 37.05% of the local bond issuance scale in that month [3][10]. - In terms of issuance pricing, the issuance rates of 10 - year, 20 - year, and 30 - year local bonds decreased by 0.8BP, 2.2BP, and 2.8BP respectively. The spread between new bonds and treasury bonds of the same term was slightly compressed, with a decline of less than 1bp, but the spread of the 30 - year variety was still similar to the reading in mid - January [3][17]. - Regionally, Hebei and Jiangxi were the main regions for local bond issuance in February. Among the regions with large issuance scales, the proportion of local bonds with a term of over 10 years issued in Henan and Zhejiang exceeded 80%, and the average coupon rates of the two regions were above 2.3%. In particular, the issuance rate of local bonds in Henan reached 2.4% [3][19]. 3.2 Secondary Trading Characteristics - The increase of local bonds was less than that of treasury bonds of the same term. During the week before the festival, the indices of 7 - 10 - year and over 10 - year local bonds rose by 0.13% and 0.16% respectively. With the entry of funds holding bonds for the festival, treasury bonds with stronger liquidity were easier to obtain, and long - term credit bonds were also favored by some institutions due to their absolute returns. Local bonds failed to outperform treasury bonds of the same term and high - grade credit bonds [4][23]. - In terms of different provinces, government bonds in Jiangsu and Guangdong were actively traded, and the trading volumes in Jiangsu, Jiangxi, and Henan increased by more than 40 transactions compared with the previous period. In addition, in regions where the average yield was above 2.25%, the trading terms were mostly extended to over 20 years. Notably, the average trading yields of local bonds in Henan and Guangxi reached 2.27% and 2.35% respectively, with average terms of 19.9 years and 18.8 years [4][23].