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[“deposit certificates have high interest rates (the spread between 1-year government bonds and 1-year deposit certificates is about 50bp), good liquidity, and a relatively short term. currently, they are very cost-effective. this year, many overseas institutions have also increased their holdings in deposit certificates.” said an investment manager of a wealth management subsidiary of a joint-stock bank in east china.]

recently, bond market sentiment has further eased. last week (september 2nd to 6th), the yields of key-term treasury bonds fell by 5 to 7 basis points. the yield of 10-year treasury bonds fell by 3 basis points in a single week to around 2.14%. the net supply of interest-bearing bonds decreased on a month-on-month basis and expectations of monetary easing increased, which promoted the recovery of bond market sentiment. most institutions of all types turned from net selling to active buying.

it is worth mentioning that compared with long-term bonds with greater regulatory uncertainty and short-term bonds with significantly lower yields, interbank certificates of deposit have become a "hot commodity". "deposit certificates have high interest rates (the spread between 1-year government bonds and 1-year certificates of deposit is about 50bp), good liquidity, and a relatively short term. currently, they are very cost-effective. this year, many overseas institutions have also increased their holdings in certificates of deposit," an investment manager of a wealth management subsidiary of a joint-stock bank in east china told yicai.

as of the close of september 9, the 1-year treasury bond yield was 1.44%, and the 1-year certificate of deposit rate was generally around 2%. many investment banks believe that the weakening of bank lending capacity in early september, the rising interest rate of funds, and the high issuance rate of bank certificates of deposit may reflect the current fragility of the capital market. considering that the capital pressure may increase in the second half of the month, the necessity of reducing the reserve requirement ratio will increase, and it may be the best choice to deploy short-term cost-effective products in advance.

bond market sentiment warms up amid easing expectations