China’s 10-year government bond yield fell to below 1.86%, starting the year lower, as investors weighed the latest PMI figures for signs on the country’s economic outlook. A private survey showed China’s December composite PMI remained expansionary for the seventh straight month, though services activity recorded its softest growth in six months. Meanwhile, official data released last week showed the composite PMI climbed to a six-month high, with manufacturing activity unexpectedly returning to expansion and the services PMI rising to a four-month peak. Markets now await upcoming trade balance and GDP figures this month for further clues. President Xi Jinping stated at the annual meeting of the Chinese People’s Political Consultative Conference that the economy is on track to achieve its 2025 growth, with GDP expected to expand by about 5%. The top leader added that Beijing will adopt more proactive macroeconomic policies in 2026 to sustain momentum.
