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Rate markets have been unresponsive.....>

CHINA RATES
CHINA RATES: Rate markets have been unresponsive to the series of policy
proposals outlined by China's state planners today, which were generally
inflationary in nature. Large scale tax cuts, measures to stabilise the auto
sector, expansion of debt-equity swaps, an increase in credit to SMEs, and an
increase in govt bond issuance for infrastructure projects were among the
proposals. 
- The 10-year bond future are down 5 ticks, testing the 97.750 level, below
which would suggest a bearish reversal is in play. Cash yields are also up
1.5bps on the day. 
- The correlation between stocks and bond yields looks to be turning positive
again as improving risk sentiment on the back of optimism on trade with the US
causes both to rise together. 

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