Bond Market Overview //
1. Open Market Operations
On May 11, the central bank launched a 7-day reverse repurchase operation of 2 billion yuan in the form of interest rate bidding, and the winning interest rate was 1.8%. Wind data shows that there is no reverse repurchase expiration on the same day, so the net investment in a single day is 2 billion yuan.
(*Data source: Wind-Central Bank Dynamic PBOC)
2. Funding side
On Saturday, the overall capital situation in the interbank market was relatively balanced, and the main repo rate fluctuated in a narrow range. Due to the absence of non-bank institutions, which have recently become more "affluent" on the replacement working day, the supply of funds is not as abundant as that of ordinary working days, but the overall demand is not high and the pressure is limited.
Overseas, the latest U.S. overnight financing guarantee rate is 5.31%.
（IMM）
(*Data source: Wind-International Monetary Fund Sentiment Index, Capital Composite Screen)
3. Interbank certificates of deposit
The latest second-level trading volume of one-year interbank certificates of deposit of state-owned and major joint-stock banks was around 2.1%, little changed from the previous day.
(*Source: Wind-Interbank Certificate of Deposit-Issuance Results)
4. The yields of major interbank interest rate bonds have mostly risen.
(*Source: Wind-Transaction Statistics BMW)
5. Recent trend and data of interest rate spreads of various maturities of urban investment bonds (AAA).
(*Source: Wind-Spread Analysis)
News //
1. According to data released by the National Bureau of Statistics, in April 2024, the national consumer price rose by 0.3% year-on-year. Among them, the urban area increased by 0.3%, and the rural area increased by 0.4%; Food prices fell by 2.7 percent and non-food prices rose by 0.9 percent; Consumer goods prices were flat, while service prices rose by 0.8 percent. From January to April, the national consumer price rose by 0.1 percent over the same period of the previous year.
2. According to data released by the National Bureau of Statistics, in April 2024, the ex-factory prices of industrial producers nationwide fell by 2.5% year-on-year, and the purchase prices of industrial producers decreased by 3.0% year-on-year, which were 0.3 and 0.5 percentage points narrower than that of the previous month, respectively. The ex-factory prices and purchasing prices of industrial producers decreased by 0.2 percent and 0.3 percent respectively from the previous month. From January to April, the ex-factory prices of industrial producers decreased by 2.7 percent over the same period of the previous year, and the purchase prices of industrial producers decreased by 3.3 percent.
3. According to preliminary statistics from the central bank, the cumulative increase in the scale of social financing in China in the first four months of this year was 12.73 trillion yuan, 3.04 trillion yuan less than the same period last year. In the first four months of this year, Chinese RMB loans increased by 10.19 trillion yuan. At the end of April, M2 grew 7.2% year-on-year. At the end of April, the stock of social financing was 389.93 trillion yuan, a year-on-year increase of 8.3%. Market experts generally said that the total amount of loans in the month was "not small", the credit structure continued to be optimized, the interest rate level remained low, and the RMB exchange rate remained basically stable at a reasonable and balanced level.
4. The new issue of savings treasury bonds was officially issued, and the market once again staged a "daylight" market. It is reported that from May 10 to 19, the Ministry of Finance will issue the third and fourth phases of this year's certificate-type savings treasury bonds. According to the issuance announcement, the maximum total issuance amount of the two phases of treasury bonds is 30 billion yuan, which is 3 years and 5 years, and the coupon annual interest rates are 2.38% and 2.5% respectively. A number of bank branch practitioners said that basically all of them were sold out within a few hours, and investors' enthusiasm for subscription continued unabated, that is, they could only buy it immediately at the beginning of the sale.
Global Macro //
1. Fed's Bostic said that despite the uncertainty of timing, it still believes that the Fed will make a rate cut this year. Fed Governor Bowman pointed out that the U.S. economy has continued momentum and needs to maintain policy stability for a longer period of time. Fed's Logan said it was too early to consider cutting interest rates and that policy flexibility was needed.
2. The minutes of the ECB's April monetary policy meeting showed that members generally agreed that further evidence is needed to gain sufficient confidence that inflation is steadily returning to the ECB's target level; There is general agreement that the price data is in line with the medium-term path; The vast majority of members agreed to keep interest rates unchanged, with several members believing that the conditions for a rate cut had been met.
Bond Events //
1. Country Garden Real Estate: "23 Country Garden MTN001" and "23 Country Garden MTN002" will complete interest repayment within the grace period
2. Shanxi Securities was approved to issue corporate bonds of no more than 6 billion yuan
3. Jilin Provincial Investment Group plans to carry out free transfer of assets and major asset restructuring
4. Yichang Xingfa Group received a regulatory warning letter from the Hubei Securities Regulatory Bureau
Negative Bond Events of the Week:
(*Source: Wind-Negative Bond Events)
The risk of non-standard assets of urban investment this month
(*Data source: Wind-Risk Monitoring RISK)
Upcoming Programs //
Every Monday at 3 p.m. from March 11th, Wind will join hands with Bank of Shanghai to bring a new series of Wind Live columns [In-depth Discussion on the Bond Market]!