FX.co ★ China’s 10-Year Yield Extends Decline

China's 10-year government bond yield decreased to approximately 1.72% on Friday, continuing its decline from the previous day as investors gravitated towards safe-haven assets amid disappointing economic indicators. Industrial production growth slowed to its lowest level in seven months during July, a downturn from a recent three-month high and failing to meet market forecasts. Compounding these concerns, retail sales growth slumped to a six-month low, and the unemployment rate edged up to a four-month peak. In the real estate sector, new home prices in 70 major cities fell for the 25th consecutive month, although July saw the mildest contraction since March 2024. These underwhelming figures highlight the increasing challenges facing Chinese policymakers as they contend with persistent domestic demand issues and external pressures. In response, authorities have recently intensified policy measures and reaffirmed commitments to boost consumption and curb excessive price competition to maintain momentum towards the 2025 growth target of approximately 5%.