China’s 10-year government bond yield hovered around 1.84%, trading in a sideways range, as investors weighed expectations of sustained government spending and proactive fiscal measures in 2026. The Ministry of Finance outlined plans to boost domestic consumption, expand investment in technology and human capital, and reinforce the social safety net, prompting markets to anticipate increased government borrowing and exerting upward pressure on long-term yields. Separately, investors assessed weaker industrial profit growth, with China’s industrial firms reporting a modest 0.1% year-on-year rise in January–November 2025, down from a 1.9% gain in the first ten months. The slowdown, reflecting softening year-end demand and persistent cost pressures, was most pronounced among state-owned and foreign-invested firms, while private companies also saw profits decline slightly.
