At the end of 2020, our view on the 20021national debt market is that "China will enter the bull market stage of a new interest rate cycle". Standing at the end of 202 1, looking back, this judgment is correct. However, it still takes a lot of determination to adhere to this view during the year, especially the relatively high year-on-year economic growth rate in the first half of the year, the gradual tightening of overseas monetary policy in the second half of the year, the huge inflationary pressure in the industrial sector, and the centralized issuance of government bonds in the third and fourth quarters, all of which have a great impact on market expectations, which also reflects the importance of grasping the main contradictions. For the judgment of the national debt market in 2022, we use Wang Anshi's poem-"The green hills are there, and suddenly Qian Fan looms". Because the bond market of 202 1 is different from previous years, although it is a bull market all year round, there is quite a feeling that green hills can't be bypassed, but with the market coming out step by step, the market in 2022 can be said to be "suddenly seeing Qian Fan looming".
202 1, the price of government bonds fluctuated upward, the market yield gradually decreased, and the market gradually entered the bull market stage from the bear market in the previous year. From the perspective of interest rate cycle, at the end of the first quarter of 20021,China started a new bull market of interest rate cycle. With the downward trend of year-on-year growth rate and real growth of domestic economy, domestic monetary conditions and credit conditions are gradually relaxed. Although the mismatch between supply and demand led to large fluctuations in commodity prices, and the sharp rise in the price of 202 1 industrial products brought great inflationary pressure to the market, the bull market in the national debt market was not blocked when the economic growth rate gradually declined marginally. Judging from the duration of an interest rate cycle, the bull market of national debt will last for a long time. We predict that domestic economic growth will be low before and then high in 2022, and real estate will continue to have a negative impact on the economy in the first half of the year, but infrastructure and real estate will pick up in the second half. Therefore, the national debt is still in the golden period of allocation in the first half of 2022.
Looking back on the operation of the bond market during the year, the market can be divided into seven stages:1-February, the market yield reached a high level in the year, and the futures price of government bonds bottomed out; From March to May, after the economy crossed the high point, the marginal downward trend became more obvious. The commodity prices that have been rising continuously in the previous period have been adjusted rapidly, and inflation expectations have cooled down, thus forming a favorable bond market and the futures prices of government bonds have risen steadily. In June, the market ushered in a round of adjustment. During this period, the economic data released in China remained at a high level, and the inflationary pressure of industrial products brought about by the rise of commodities remained severe, and the market yield stage rebounded. From June to August, the futures price of government bonds ushered in a main wave. Affected by the marginal slowdown of domestic economic data, the reduction of RRR by the central bank, the lag of interest rate bond issuance and the high differentiation of commodities, the futures price of government bonds rose sharply. From August to September, the pressure on the issuance of treasury bonds increased, the prices of superimposed commodities were generally at a high level, and treasury bond futures entered a high level. At the beginning of 10, the bond market was under pressure due to factors such as rising commodity prices and a general rebound in overseas yields, and treasury bond futures entered a phased adjustment. After 5438+ 10 in mid-June, the economic and policy environment faced by the bond market gradually turned friendly, the downward pressure on the economy increased, the expectation of steady policy growth increased, and the domestic credit conditions and monetary policy turned loose in an all-round way, which was conducive to the continuation of the bull market of national debt.
From the perspective of bond market financing, the progress of 202 1 national debt issuance is relatively scattered, and the impact of national debt issuance on the market is low. In 2022, the maturity scale of national debt will be 5.10.5 trillion. Under the condition of maintaining the level of about 3% in deficit ratio, the new scale of the national debt market is expected to reach more than 3 trillion, and the total issuance scale will be more than 8 trillion. Under the demand of steady growth, the issuance of national debt will go ahead. On the demand side, in 2022, market credit stratification will promote interest rate varieties with high credit rating and asset allocation demand. In addition, the enthusiasm of banks, insurance, funds and overseas institutions will remain at a high level in the case of slowing domestic economic growth, abundant market liquidity and insufficient supply of high-quality assets.
Judging from the relative valuation of domestic and foreign markets, most major economies were in the process of recovery in 20021year. Under the circumstance that inflationary pressure continues to run at a high level, the monetary policies of major central banks have also started the normalization process. Under the comprehensive influence of economic recovery, rising prices and policy shift, the yield of overseas government bonds rebounded at a low level. With the contraction of domestic and foreign spreads, the fluctuation of overseas bond market yield will have a greater and greater impact on China bond market. If the recovery of overseas yields narrows the spread of Sino-US 10-year treasury bonds to a safe spread of 100BP, it will have a great impact on the domestic bond market and monetary policy orientation. At present, the domestic yield level still has a high safety buffer, and the rebound of overseas bond market yield and the change of monetary policy have relatively limited impact on China's national debt yield and monetary policy. As for the allocation of foreign capital, by the end of 20021and1/the amount of bonds held by overseas institutions with the Central Clearing Company has increased for the 36th consecutive month, which is closely related to the relative attractiveness of the domestic bond market and the improvement of the openness of the domestic bond market. 202 1 The domestic bond market continues to open to the outside world. 202 1, 101On October 29th, FTSE Russell officially incorporated China government bonds into FTSE government bond index. China's domestic bond market has been successively included in the three global bond indexes-Bloomberg Barclays Global Composite Index, JPMorgan Chase Global Emerging Market Diversification Index and FTSE World Government Bond Index (WGBI). In addition, the bond link "Southbound Link" was officially launched on September 24th, 20021,which means that the internationalization of China bond market has taken another important step. The low correlation and high yield between China bonds and major global assets will continue to attract overseas active and passive funds to increase their allocation.
This article comes from Founder Mid-term Futures.