The yield on China's 10-year government bonds has increased to approximately 2.21%, marking a three-week peak as investors respond to the latest PMI rorts. Official data released on Monday showed a slight uptick in manufacturing activity for Stember 2024, recovering from an earlier six-month low and exceeding expectations. However, services activity has weakened, falling below market forecasts and reaching its lowest level since January 2023.
A private survey revealed an unexpected sharp decline in manufacturing, indicating the steest contraction observed since January 2023. Services activity also diminished in Stember, missing market projections and hitting its lowest point since the same month last year.
In a related development, the People's Bank of China announced on Sunday that homeowners will have the opportunity to renegotiate their mortgage terms starting November 1. This move follows Beijing's implementation of its largest stimulus package since the onset of the COVID-19 pandemic, aimed at countering the ongoing economic slowdown.
On Stember 30, the yield for the 10-year bond was registered at 2.16% based on over-the-counter interbank yield quotes. Analysts project that the China 10-Year Government Bond Yield will trade at 2.15% by the close of this quarter, with further estimates suggesting it will decrease to 2.07% over the next twelve months.