According to the CITIC Securities Research Report, part of the reason for the pullback in the early bond market is due to a decline in the willingness to allocate accounts and increase positions. The reason behind this may be related to the long-term shortening of bank debt. From a medium-term perspective, there is a high probability that the central bank's investment in medium- to long-term liquidity instruments will gradually increase, and the share of banks on the debt side will gradually increase, which may help improve commercial banks' demand for long-term bonds. Looking back, the Central Economic Work Conference proposed “flexible and efficient use of various policy tools such as interest rate cuts”. Combined with the overall decline in economic data for November, we believe that monetary policy may move forward, and the necessity and feasibility of short-term interest rate cuts has increased. In addition, the problem of long-term mismatch of bank assets may gradually improve in the central bank's liquidity care environment, and the liquidity assessment pressure will come to an end with the end of New Year's Eve. Combined with the relatively sufficient current round of adjustments and the increase in the possibility of interest rate cuts in the short term, we expect that early 2026 bond market wins and odds may improve in stages, and during the New Year's Eve period, we can pay attention to the repair of ultra-long bonds.

According to the CITIC Securities Research Report, part of the reason for the pullback in the early bond market is due to a decline in the willingness to allocate accounts and increase positions. The reason behind this may be related to the long-term shortening of bank debt. From a medium-term perspective, there is a high probability that the central bank's investment in medium- to long-term liquidity instruments will gradually increase, and the share of banks on the debt side will gradually increase, which may help improve commercial banks' demand for long-term bonds. Looking back, the Central Economic Work Conference proposed “flexible and efficient use of various policy tools such as interest rate cuts”. Combined with the overall decline in economic data for November, we believe that monetary policy may move forward, and the necessity and feasibility of short-term interest rate cuts has increased. In addition, the problem of long-term mismatch of bank assets may gradually improve in the central bank's liquidity care environment, and the liquidity assessment pressure will come to an end with the end of New Year's Eve. Combined with the relatively sufficient current round of adjustments and the increase in the possibility of interest rate cuts in the short term, we expect that early 2026 bond market wins and odds may improve in stages, and during the New Year's Eve period, we can pay attention to the repair of ultra-long bonds.