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Focusing on the high-quality development of the China debt market, the 2025 ICMA China Debt Capital Markets Annual Conference was held in Beijing.
On March 19, the 2025 ICMA China Debt Capital Markets Annual Conference, organized by the International Capital Markets Association (ICMA), was held in Beijing.
The central bank has been conducting hundred billion reverse repurchase operations for several consecutive days, signaling its support for the liquidity situation. What will be the trend moving forward?
① In the past three days, the central bank has continuously conducted reverse repurchase operations worth hundreds of billions, clearly signaling support for market liquidity. ② Market participants point out that the net injection scale is relatively limited and has not changed the upward trend of short-term interest rates. This may reflect policy objectives aimed at preventing funds from idling and curbing a rapid decline in long-term bond yields. ③ The possibility of the central bank stimulating a relaxation of market liquidity through large-scale liquidity injection is relatively low.
300 billion yuan is allocated to support consumer goods for trade-in and upgrade. This year, the list of special government bond uses is clear, supporting "two重" up to 800 billion.
① This year's 1.3 trillion ultra-long-term special government bonds may drive GDP growth by 1.7-1.9 percentage points. ② In 2024, the issuance of ultra-long-term special government bonds will have terms of 20 years, 30 years, and 50 years, with the first issuance on May 17 and completion in mid-November.
The policy of social financing drives emotions to improve faster than the fundamentals, giving the central bank more confidence.
The structure of social financing still demonstrates a relatively strong characteristic of policy-driven effects, with low market-oriented financing demand. This means that sentiment is improving faster than changes in the fundamentals, and the transmission of policy to reality will still take time. The adjustment space for the bond market should be limited. However, the marginal stabilization of social financing may continue to strengthen the central bank's confidence, leading to a further reassessment of the pace of interest rate cuts and reserve requirement ratio reductions.
Important data released during the Two Sessions: the budget deficit rate is planned to be set at 4%, with an additional government debt of 11.86 trillion this year, and the bond market has performed relatively strongly.
① This year, the total new government debt reached 11.86 trillion yuan, an increase of 2.9 trillion yuan compared to last year, with a significant increase in fiscal spending intensity. ② Government bond Futures opened higher, the 30-year Block Orders rose by 0.27%, the 10-year Block Orders rose by 0.14%, the 5-year Block Orders rose by 0.09%, and the 2-year Block Orders rose by 0.04%.
The highest adjustment is a reduction of 50 basis points! Several small and medium-sized Banks have continuously lowered deposit interest rates in the first quarter, and it has become a "hard truth" to reduce the cost of liabilities while maintaining inte
① The first quarter is a key stage for the repricing of Bank loans, and it is expected that Bank interest margins will continue to decline. ② It is anticipated that the reduction in the cost of liabilities for listed Banks throughout 2025 is likely to exceed the level for the entire year of 2024. ③ Many Banks are trying to widen non-interest income, and even expand their Business overseas, but the effects are not as pronounced as reducing the cost of liabilities.
