China Tightens Grip on Bond Market Amid Economic Concerns

The People's Bank of China intervenes to stabilize long-term interest rates, facing challenges of low growth and deflation risks.

The PBOC has begun borrowing and selling government bonds to control yields and maintain market stability.
Authorities aim to keep 10-year bond yields above 2.2% to deter excessive market speculation.
Analysts are skeptical about the long-term impact of these measures given China's sluggish economic recovery.
The central bank's new operations include temporary repos and reverse repos to manage short-term liquidity.
China's efforts contrast with other economies, focusing on deflation rather than inflation.