One-year central vote rate continued to rise 8 basis points institutions abandon short buy long preference do not change

Newspaper reporter Liulanchang Beijing reported June 8, the one-year central vote issuance rate continued to rise 8 basis points to 2.0929%.　　The pressure on asset allocation and concerns about slowing economic growth will still encourage institutions to favour medium-and long-term coupons, while market funding tensions are pushing up the yield on short-term central-vote issuance.　　The central bank 8th in the open market issued 25 billion yuan a year, the winning rate rose 8.32 to 2.0929%, the same as on June 2, the first-year issue of the yield has risen nearly 17 points, and the two-tier market interest rates are close. "This is under pressure from the recent capital side, the central bank to guide the short end interest rate upward."　　"But because credit line management puts pressure on banks to allocate assets and worries about the economy, the agency's preference for medium-and long-term coupons will remain unchanged in the short term," said one city firm's Market investment ministry. The stock of high interest bonds is due to be put under pressure. In fact, after entering the May, the institutional "abandon short buy long" investment preference is increasingly obvious.　　In this kind of preference, under one year of the central vote and the three-year issue of the issuance of income rate recently showed a decline in the trend. The "abnormal" trend of the market mainly stems from the pressure of asset allocation brought by credit line control.　　Li Jieming, a bond analyst at Cathay Securities, argues that, with limited loans, banks are increasingly relying on higher interest income to raise their overall interest income levels, and that the maturing and reinvestment pressures of stocks of high-yield bonds also force investors to lengthen the duration of their bond portfolios. "Taking the 3-year central vote as an example, in 2007, a 1.4 trillion-yuan 3-year central vote was issued, with a weighted nominal interest rate of 3.47%, which led to a large maturity reinvestment pressure in 2010, with a weighted coupon rate of 3.47% per cent even higher than the current 10-year bond yield, Investors have had to avoid a significant decline in portfolio yields by lengthening the length of the bond portfolio over time.　　"he said. In addition, he said the tightening of domestic credit, the increase in the central bank's currency, the strengthening of real estate control policies and the intensification of the European debt crisis have led investors to lower domestic economic growth and inflation expectations, the central bank's first-half rate hike expectations have also been weakening,　　This makes the long-term bond yields have an objective basis for maintaining low levels. "In May the stock market fell and the bond market rose, with medium-and long-term interest rate products particularly popular, which is expected to continue into June."　　"Li Jieming said.　　Bond analysts at the first venture securities also argue that the strong demand for the three-year vote is more implicit in the agency's judgment about the likely slowdown in future economic growth, and that this exuberant demand will persist in the event of a decline in real economic activity.　　While the demand for the medium and long term debt allocation is strong, the repurchase interest rate has a very tight situation in the short term, and the inter-bank repurchase rate even exceeds the yield of the short-term central votes, further exacerbating the upward pressure of the short-term central vote yield. The Strategic management Department of ABC believes that the recent liquidity tension is mainly three factorsCaused by: First, three times this year to increase the statutory deposit reserve ratio and continuous open market funds net withdrawal, the bank's excess reserve ratio has fallen sharply; the second is that several big banks have been heavily indebted recently, freezing large amounts of subscription funds, with new loans likely to fall to less than 550 billion trillion yuan in May and the corresponding derivative deposits to be reduced. In the combination of the above factors, since May, the interbank market repurchase rate has climbed, to June 2, 7 days to the 3.27%-day repo rate reached the interval high, the overnight repurchase rate reached 2.76%, at the same time, before June 2, the one-year central ticket issuance rate has been 17 consecutive times unchanged at 1.9264%,　　and repurchase rates are seriously upside down. "The rise in repo rates is also forcing the central bank to raise the yield on short-term votes, otherwise demand will only shrink."　　"Analysts at the first venture Securities said, but he also pointed out that as the open market to net and BOC Bond purchase ended, the height of the capital face will be greatly eased, the repo rate will fall, which will weaken the 1-year central vote interest rate upward pressure. Despite a pick-up in interbank repo rates on June 8, the two-day trading session has fallen sharply, so the current level has fallen by about 100 basis points from the earlier month's peak.　　The city's business people believe that the central bank in the next few weeks is still the main fund, the money market will also enter the peak period, the funds will gradually be mainly loose, the short-term interest rate is expected to gradually fall. "The yield on the first-year central vote is likely to be halted before 2.1%, and the seven-day repo rate is likely to return below the one-year central vote, but don't expect to fall too far."　　"he said. Li Jieming also believes that the seven-day repo rate will gradually fall, but still higher than the previous level of about 1.7%, one-year central vote issuance rate will gradually upward to about 2.1%, three-month central vote issued interest rate up to 1.6-1.7%, three-year central vote issued interest rate will be gradually reduced to around 2.65%, In order to hedge the short-term interest rate increase in the negative impact of the issue.