China 10Y Yield Hits Near 1-Month Low

China’s 10-year government bond yield fell to 1.74% on Wednesday, extending declines from the previous session and hitting a one-month low, as the People’s Bank of China maintained an accommodative monetary policy stance amid weakening economic momentum. The PBoC kept the one-year loan prime rate (LPR) unchanged at 3% and the five-year LPR at 3.5%, maintaining both at historically low levels for a twelfth consecutive month in May. The decision came despite mounting signs of slowing domestic activity, with industrial output growth easing to its weakest pace since July 2023 and retail sales expanding at its slowest rate since December 2022. The softer economic data reinforced expectations for additional stimulus, with investors now closely watching the Communist Party’s Politburo meeting in July. Meanwhile, both consumer and producer inflation accelerated, driven largely by higher energy prices and ongoing supply-chain disruptions tied to the conflict.

China’s 10-year government bond yield fell to around 1.74% on Tuesday, extending losses from the previous session and hitting its lowest level in nearly a month, as weak economic data fueled expectations of stimulus measures. New home prices across 70 major cities fell 3.5% year-on-year in April 2026, marking the steepest drop since May 2025. Fixed-asset investment also declined 1.6% annually in the January–April period. Moreover, industrial output eased to 4.1% in April, marking the weakest growth since July 2023, while retail sales rose just 0.2%, pointing to weak domestic consumption. Meanwhile, the surveyed urban unemployment rate edged down to a three-month low of 5.2% in April. The data signal a broad slowdown, reinforcing expectations of policy support, although authorities remain cautious. Markets are now focused on the Communist Party’s Politburo meeting in July, viewed as a key juncture for reassessing growth targets and policy direction.

China’s 10-year government bond yield fell to 1.75% on Friday, reversing the previous session’s gains and hitting its lowest level in more than two weeks, supported by optimism surrounding the high-stakes Trump–Xi meeting. The two leaders opened a second day of talks at Zhongnanhai, a rare and symbolic venue seen as more intimate than the Great Hall of the People. Trump said “a lot of good” had come from the visit and claimed the two sides had reached “fantastic trade deals,” while Xi said both countries had agreed to stabilize trade ties, expand cooperation, and manage differences constructively. Key outcomes included China’s expected purchase of 200 Boeing aircraft and “double-digit billions” of dollars in US agricultural imports over the next three years. Meanwhile, Trump said Washington and Beijing shared similar views on ending the conflict and keeping the Strait of Hormuz open, while China’s foreign minister called for safeguarding the critical maritime corridor.