the central bank's treasury bond buying and selling column was updated for the second time, with net purchases of 200 billion yuan in september
2024-10-02
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in september, the central bank conducted another treasury bond buying and selling operation.
on september 30, the people's bank of china issued an announcement on the purchase and sale of government bonds in september, saying that in order to increase the countercyclical adjustment of monetary policy and maintain reasonable and sufficient liquidity in the banking system, the people's bank of china launched an open market purchase and sale of government bonds in september 2024, with net purchases throughout the month. the face value of the bonds is 200 billion yuan.
the bond market has been highly volatile over the past week. on september 29, the yields of 10y and 30y government bonds increased by 21.5 bp and 29.5 bp respectively from september 23; on the 29th, the yields of 3y and 5y aa+ mid-term notes increased by 21.8 bp and 23.0 bp respectively from the 23rd.
"it is rare in history for yields to rise so quickly." zhang xu, chief fixed income analyst at everbright securities, suggested that flexibly carry out treasury bond buying and selling operations in the open market and consider buying when treasury bond yields rise too quickly ( super) long-term varieties. the people's bank of china's buying and selling of treasury bonds is mainly aimed at base currency injection and liquidity management, and also has the function of maintaining the sound operation of the bond market. during the period of rapid decline in yields in the past two months, the people's bank of china conducted a "buy short and sell long" operation. in the stage when the long end of the yield curve is rising rapidly, the people's bank of china's purchase of varieties with corresponding maturities can not only maintain the smooth operation of the bond market, but also support proactive fiscal policies to be more effective.
in august of this year, the central bank’s official website launched the “announcement on open market treasury bond trading business” column to release signals for buying and selling treasury bonds. on august 30, the above-mentioned central bank announcement column appeared for the first time. september 30th will be the second update.
on september 29, the central bank released the content of the regular meeting of the monetary policy committee. the meeting pointed out that the monetary policy toolbox should be enriched, government bond sales should be carried out, and changes in long-term yields should be paid attention to.
according to market analysis, the central bank's net purchase of treasury bonds means that it provides medium and long-term liquidity from a liquidity perspective, which objectively plays a role in supplementing medium- and long-term liquidity. at the same time, incorporating government bond operations into the conventional toolbox will help smooth monetary policy operations, strengthen fiscal and monetary policy coordination, and promote long-term market development.
recently, a package of monetary policies has taken the lead, with rrr cuts, interest rate cuts, and existing mortgage interest rates being implemented one after another. the market is looking forward to the introduction of subsequent incremental fiscal measures.
sheng songcheng, a professor at china europe international business school and former director of the survey and statistics department of the people's bank of china, recently suggested that the issuance of special government bonds should be increased to support the consumption sector, and that monetary policy should actively cooperate. at the same time, stabilizing growth policies should be more tilted towards people's livelihood areas. at present, the issuance of local government bonds is progressing slowly. the central bank's release of liquidity through lowering the required reserve ratio can help commercial banks purchase more government bonds. increasing the supply of treasury bonds will help to use treasury bond trading as a common tool for monetary policy and accelerate the transformation of my country's monetary policy into price-based regulation.
(this article comes from china business news)
