In April 2018, contrary to market expectations, the central bank unexpectedly lowered the reserve ratio, and the market judged that the central bank’s monetary policy had shifted or fine-tuned, resulting in a sharp increase in bond prices, especially interest-rate debt and high-grade credit bonds, and a longer-term increase in long-term government bonds. The market is generally expected that the bond market has entered the bull market. However, due to the excessively sharp rise and the extremely tense financial situation at the end of April and the negative factors such as the sharp drop in the ten-year Treasury bond in the United States, the bond market at the end of the month has been adjusted to some extent.

We believe that even with the rise in the past three months, the yield on China’s bond market is still high and the investment value is outstanding. From the domestic fundamentals, 2018 China’s foreign trade situation will face more severe challenges regardless of the outcome of the Sino-US negotiations. The investment methods of Yantai are also difficult to sustain, so the downward pressure on the economy is relatively large. This is particularly favorable for the bond market, especially for high-grade bonds, so the 2018 bond market has better investment opportunities.