China 10Y Yield Holds at 2025 Low

China’s 10-year government bond yield fell to around 1.67% on Thursday, remaining near its lowest level since July 2025, even as uncertainty over the extension of the US-China trade truce persisted. US Treasury Secretary Scott Bessent said the US and China had agreed to extend the truce by two months through January 10. However, China has yet to publicly confirm the expiration date, while the extension falls short of the three-to-six-month continuation previously suggested by some US officials. The decline in Chinese yields came despite a broad global bond selloff, as stronger-than-expected US economic data and weak demand at a Treasury auction drove yields across much of the US curve to their highest levels in nearly two decades. The yield premium of 10-year US Treasuries over Chinese government bonds remained close to a record high.