China 10Y Yield Rises After PMI Data
China’s 10-year government bond yield rose to around 1.72% on Tuesday, rebounding from a near one-month low in the previous session as stronger-than-expected PMI data eased concerns about the country’s economic outlook, reducing demand for safe-haven assets. China’s Composite PMI edged up to a six-month high of 50.6 in June from 50.5 in the previous month. Manufacturing PMI rose to 50.3 from 50.0, surpassing forecasts of 50.1, supported by resilient demand for high-tech exports that helped offset trade disruptions stemming from tensions in the Middle East. Meanwhile, the non-manufacturing PMI ticked up to 50.2 from 50.1, beating expectations of 49.9 and pointing to continued stabilization in the sector. On the monetary policy front, the central bank launched overnight reverse repo operations, injecting CNY 300 billion into the financial system to strengthen short-term liquidity management and enhance stability in money markets.

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