29.12.202505:02:06UTC+00China 10-Year Yield Trades Sideways

China's 10-year government bond yield remained steady around 1.84%, as investors considered the likelihood of continued government expenditure and assertive fiscal strategies anticipated for 2026. The Ministry of Finance has detailed its plans to stimulate domestic consumption, increase investments in technology and workforce development, and bolster the social safety net. This has led markets to predict an increase in government borrowing, thereby applying upward pressure on long-term yields. Meanwhile, investors took note of a slower pace in industrial profit growth, with China's industrial firms posting a minimal 0.1% year-on-year increase from January to November 2025, a decline from the 1.9% growth recorded in the initial ten months. This deceleration, indicative of diminishing year-end demand and ongoing cost issues, was most noticeable among state-owned and foreign-invested firms, although private enterprises also experienced a slight drop in profits.