Government bond financing rises as corporate net issuance turns negative
Government bond net financing reached RMB1,536.22 billion in September 2026, while corporate bond net financing was negative RMB39.26 billion, according to the People's Bank of China (PBoC). Money market rates remained broadly stable.
Public borrowing outpaces corporate financing
Government bond net financing rose RMB346.96 billion year on year, while enterprise bond net financing decreased RMB52.9 billion.
Outstanding bonds totaled RMB210.8 trillion.
Daily interbank lending averaged RMB292.54 billion, down 30.5 percent; bond repos averaged RMB6.5 trillion, down 10.6 percent.
Outstanding lending and repos were RMB0.8 trillion and RMB11.0 trillion.
Monthly weighted average DR001 was 1.38 percent; DR007 and R001 were both 1.40 percent, broadly unchanged.
The 10-year China government bond yield ended September at 1.68 percent.
Its spread over the 1-year yield narrowed 1 basis point to 46 basis points.
The 3-year AAA corporate spread fell 8 basis points to 35 basis points, unadjusted for tax.
Derivatives expand as equities retreat
Interbank RMB derivatives turnover rose 48.7 percent year on year to RMB7.4 trillion; government bond futures turnover fell 24.0 percent to the same amount.
The 1-year FR007 swap rate closed at 1.43 percent.
The Shanghai and Shenzhen stock benchmarks fell 3.6 percent and 8.0 percent to 3,842.2 and 12,887.6. Daily equity turnover declined 18.9 percent to RMB1,816.97 billion.
The RMB appreciated 0.22 percent against the dollar to 6.7053; the CFETS RMB Index rose 1.31 percent to 103.20. Shanghai Gold Exchange Au (T+D) fell 5.7 percent to RMB906.6 per gram.
Credit ownership remains concentrated
Corporate credit bond holdings remained concentrated: the largest 50 investors held 54.1 percent and the largest 200 held 85.4 percent.
Those groups accounted for 61.3 percent and 92.1 percent of trading, respectively.
Moreover, 87.4 percent of corporate credit bonds had no more than 20 holders.
Source: Financial Market Report (September 2026)
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