China 10Y Yield Remains at Over 1-Year Low

China’s 10-year government bond yield traded around 1.68% on Monday, remaining at its lowest level in over a year as a raft of disappointing economic data reinforced expectations for additional policy stimulus to bolster growth. Fixed-asset investment shrank 6.7% year-on-year in the first seven months of 2026, worse than the expected 6.2% fall. Industrial output slowed to 4.5% in July from 5.3% in June, missing expectations of 5%, while retail sales rose just 0.6%, below forecasts of 1.5% and down from 1% in the previous month. In addition, the surveyed unemployment rate edged up to 5.2%, its highest level in three months. China’s National Bureau of Statistics said the economy has remained “generally stable” this year, though it warned of a “complicated and volatile” external environment and weak domestic demand, prompting investors to expect further stimulus to keep the economy on track to meet this year’s growth target.

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