when the yield of government bonds rises, the price of bonds will fall, and debt-based wealth management products will fall. Under what circumstances will the yield of government bonds rise?

First, whether monetary policy will continue to be loose. Monetary easing is equivalent to increasing the supply of funds. If monetary policy is further relaxed, interest rates are expected to fall.

second, will the demand for funds decline? If the demand for funds declines, then the interest rate is also expected to decline. The decline in the demand for funds is equivalent to reducing the demand for funds.

in a word, it is like that the scarcity of things is precious, the supply of funds remains unchanged or the supply of funds decreases, but the demand for funds in the market increases, so the bond interest rate will rise as a result. or vice versa, Dallas to the auditorium

2, but the actual situation is puzzling!

Monetary policy:

On December 5th, the central bank lowered the RRR by .25 percentage point, releasing about 5 billion yuan of long-term funds. (News on November 25th)

Open Netease News to see the wonderful picture

Ten-year treasury bond yield trend chart

As can be seen from the above figure, the monetary easing on November 25th news did not stop the rise of treasury bond yield!

since the central bank has rescued the market and implemented monetary easing, why does the debt base continue to fall? Theoretically speaking, RRR reduction is a manifestation of loose monetary policy, which has increased the supply of funds in the market. The interest rate of government bonds should fall and the debt base should strengthen. But why is the net value of debt base still falling?

I can only guess that the market funds are still insufficient, and the overall supply is not enough to cope with the increase in demand.

For example, some people expect that the economy will improve in the future, and they are short of funds, so they can only continue to throw away their national debt and exchange it for cash to invest in the stock market and other fields. See my other article for details.

In addition, many people who buy wealth management are ordinary people, and ordinary people can't accept the loss of wealth management at all, so there is a large-scale run, and they have redeemed their wealth management and replaced it with time deposits. However, the bank wealth management manager has to continue to sell the debt base to cash it (the main component of debt-based wealth management products is national debt), and the bond price has fallen due to the selling, thus creating a vicious circle.

the people's bank of China released the financial statistics report for November 222. At the end of November, the balance of RMB deposits was 257.78 trillion yuan, up 11.6% year-on-year, and the growth rate was .8 and 3 percentage points higher than that at the end of last month and the same period of last year respectively. In November, RMB deposits increased by 2.95 trillion yuan, an increase of 1.81 trillion yuan. Among them, household deposits increased by 2.25 trillion yuan. (News on December 12th)

3. Will the new turning point stabilize the downward trend of financial management? !

Let's look at the latest monetary policy:

On December 15th, the central bank lowered the RRR by .5 percentage point, releasing about 1.2 trillion yuan of long-term funds. (News on December 6th)

Open Netease News to view wonderful pictures

Trend chart of ten-year treasury bond yield

As can be seen from the above figure, the monetary easing policy announced on December 6th is still effective, temporarily stabilizing the rise of treasury bond yield and even falling back.

But why did the yield of government bonds continue to rise on December 7th? The benefits were digested so quickly!

I guess the reason may be: there is still some shortage of market funds or the demand for new capital financing is further increasing.

On December 7th, the State Council issued a relatively heavy policy to prevent and control the "National Ten Articles" epidemic, and this policy is also beneficial to the economic market (stock market). In addition, the continuous redemption of people's financial management and the possible signs of recovery in the stock market have led to some shortage of market funds or a further increase in the demand for new capital financing (or both).

although the ten-year treasury bond yield trend chart shows that the treasury bond yield has also leveled off these days, there are still risks in the future.

when the economy is better, a lot of money will flow to the stock market and other places where money can be made faster, and the income from debt base will fall. From December 222 to March 223, with the optimization of epidemic prevention and control, the economy will have a shock transition period. After March next year, everyone is generally optimistic about the economic trend, which will definitely be more beneficial to the stock market. In order to stabilize the income of wealth management products soon, unless there is further economic easing policy or the financing demand of funds changes.

if you can't accept the short-term income fluctuation of current wealth management products, it is also an option to redeem those that can be redeemed first, and then consider buying wealth management products again in batches after the yield of government bonds stabilizes (people who bought funds at the end of 221 broke their hearts, and those who bought wealth management at the end of 222 broke their hearts, making it increasingly difficult for ordinary people to manage their finances)! If you can still accept higher-risk financial management and have cash available for investment, it is also a new choice to continue to pay attention to index funds (such as CSI 3 and CSI 5) or the stock market now.