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China’s Liquidity Measures Slash Short-End Yields Significantly

2/8/2025

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Summary

Story summary

China's liquidity measures are effectively reducing short-end yields and alleviating a flattening yield curve.
The one-year yield experienced a significant drop of nearly 10 basis points this week, marking the largest decline since December.
This decrease outpaces reductions in rates for ten-year bonds.
The sovereign yield curve has slightly steepened after reaching its flattest point since late 2023.

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Story summary

China's liquidity measures are effectively reducing short-end yields and alleviating a flattening yield curve.
The one-year yield experienced a significant drop of nearly 10 basis points this week, marking the largest decline since December.
This decrease outpaces reductions in rates for ten-year bonds.
The sovereign yield curve has slightly steepened after reaching its flattest point since late 2023.