CHINA TAKES ACTION AGAINST RISING BOND PRICES.
PBOC decided to borrow treasury bonds from primary dealers in open market operations, based on prudential observations of current market situations.
China's 10-year bond futures drop 0.2%, and 30-year bond futures falls 0.6%.
China's 10-year bond futures drop 0.2%, and 30-year bond futures falls 0.6%.
Due to the lackluster performance of the Chinese stock market, investors are redirecting funds towards the risk-off fixed-income market.
Currently, non-bank institutions are purchasing more government bonds than the tolerance level of the PBOC, leading to repeated record highs in government bond prices. This action will provide liquidity and curb the excessive unilateral upward movement of bond prices.
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Spinee OP : CITICS is now expecting PBOC will sell government bonds to the open market to support long-term bond yields this week.