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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CHINA
- In the past year, we have seen that China LT bond yields have been mainly driven by the rise in uncertainty and the significant deceleration in economic activity rather than the surge in inflation.
- As a result, China 10Y yield has been constantly testing lower highs and currently trades at a low level relative to its historical range.
- The chart below shows the strong co-movement between ‘risky’ and ‘safe’ assets in China in recent years; periods of falling LT bond yields have been associated with equity weakness and vice versa.
- Chinese equities and 10Y yield keep reaching new lows recently despite market pricing in further easing from Chinese policymakers in the medium term.
- Support to watch on the Hang Seng index stands at 22,500, which corresponds to the low of its LT downward trending channel (which was rejected several times in the recent bear cycle).
- For China 10Y yield, key support remains at 2.80%, which corresponds to the 61.8% Fibo retracement of the 2.46% - 3.36% range (2020/2021low high).
- Are China 10Y yield/Hang Seng Index set to test new lows before reaching new highs?
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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