China’s 10-year government bond yield hovered near a two-month low of around 1.76% on Wednesday, as investors were drawn by growing expectations of monetary policy easing by the People’s Bank of China. Markets expect the central bank to cut both the benchmark interest rate and the reserve requirement ratio before year-end to support the economy amid risks from US-China trade tensions. In recent developments, President Donald Trump voiced optimism about a favorable deal with Beijing but acknowledged that a planned meeting with President Xi Jinping may not happen. Similarly, US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng will meet in Malaysia this weekend to discuss key issues, including China’s rare earth export restrictions and Trump’s tariff threats. Meanwhile, investors are closely watching the Chinese Communist Party’s Fourth Plenum for potential policy signals.
