China’s 10-year government bond yield fell further below 1.8% on Tuesday, nearing a three-week low, as investors continued to move into safe-haven assets amid mounting concerns over a possible escalation of conflict in the Middle East. A senior US official signaled that Washington may sharply intensify strikes on Iran within 24 hours, with potential targets including missile production facilities, drones, and naval assets.
At the same time, Iran warned that vessels attempting to pass through the Strait of Hormuz — a critical chokepoint for around one-fifth of global oil shipments — could come under attack. Such threats risk disrupting tanker traffic and amplifying concerns about global oil supply.
As the world’s largest oil importer, China is particularly vulnerable to higher energy prices, which could dampen economic growth and add upward pressure on domestic inflation. Against this backdrop, attention is now focused on Beijing’s annual “Two Sessions,” scheduled for March 4–11, where policymakers are expected to set key economic targets, outline policy priorities, and unveil the 15th Five-Year Plan covering 2026–2030.
