China's financial markets show mixed trends in February

The People's Bank of China (PBOC) has released its Financial Market Report for February 2026, detailing activity across money, bond, and derivatives markets. The report highlights increased interbank lending and a slight appreciation of the RMB against the US dollar.

Interbank activity surges, bond yields stable

In February 2026, China's money market experienced robust activity.

Interbank lending turnover surged by 87.1 percent year-on-year to RMB429.32 billion, while bond repos increased 52.9 percent, reaching an average daily turnover of RMB7.4 trillion.

Key interbank interest rates remained largely stable; the overnight repo rate (DR001) averaged 1.33 percent, and the 7-day rate (DR007) declined by 2 basis points to 1.49 percent.

The average daily spread between DR001 and the central bank's 7-day reverse repo rate was -7 basis points.

In the bond market, net financing from government-issued bonds fell by RMB292.53 billion year-on-year, and enterprise bond issuances also decreased.

Total outstanding bonds in custody reached RMB198.9 trillion by month-end.

The yield on 10-year China government bonds (CGBs) stood at 1.78 percent, and the yield spread between 10-year and 1-year CGBs was stable at 46 basis points.

Overseas institutions maintained holdings of RMB3.4 trillion, representing 1.7 percent of outstanding bonds.

Derivatives and stock trading decline, RMB strengthens

In February 2026, RMB derivatives trading turnover fell 11.7 percent year-on-year to RMB3.8 trillion, and CGB futures trading declined 18.4 percent, though open interest rose 32.5 percent.

The bill market's outstanding balances for accepted and discounted commercial drafts increased by 6.1 percent and 8.5 percent year-on-year.

Gold trading volumes on major exchanges saw significant year-on-year decreases.

The RMB appreciated 1.35 percent against the U.S. dollar, with USD/CNY closing at 6.8559. Stock market indices, SSE Composite and SZSE Component, rose 1.1 percent and 2.0 percent respectively, but average daily turnover decreased 24.0 percent.

A descriptive market pulse

This PBOC report offers a purely descriptive overview of China's financial markets, meticulously detailing various metrics without interpretation.

While providing valuable granular data, it refrains from offering any forward guidance or explicit policy implications.

Its utility lies in presenting a factual snapshot, leaving readers to draw their own conclusions about underlying economic forces or future policy directions.