In 2018, the bond market in China may have some extent but limited rates of inte

China National Institute of Finance and Development and First Pioneer Bond Research Institute released a report over the weekend that the interest rate of the Chinese bond market may reach a certain degree of upward extent by 2018, but at a limited rate. In the context of the Fed's expectation of raising interest rates three times in 2018, the Chinese central bank still has the motivation to raise market interest rates through open market operations. However, there is little room for upward market interest rate liberalization.

The report released at the 2017 China Bonds Forum said that in 2018, the Chinese bond market will still be affected by the multiple factors at home and abroad. Fed rate hike and shrink chart will follow the principle of prudence and order, the European and Japanese central banks are most likely to maintain its existing monetary policy stance. China's central bank to follow the policy of the Federal Reserve interest rate policy to adjust the open market interest rates will still be subject to domestic economic and financial stability constraints.

"Liquidity-driven asset prices and the downward spread of bond yields are incompatible with the government's new concept of financial development and macroeconomic policy objectives," the report said.

The report also said that the central bank open market operations on the Fed's interest rate policy is also a step-by-step strategy to convey to the market is expected to yield upward expectations, but the demand side will once again become the dominant commodity prices, PPI and resulting GDP level The index will tend to converge in 2018, and the inflation compensation required for the bond yield will decrease accordingly.