Bond prices on China's interbank market eased on Friday, dragged by investors' heavy wait-and-see sentiment after Chinese central bank's reported directive repo sale to banks Thursday.
ChinaBond New Composite Total Return Index, a broadly-based market sentiment indicator, lost 0.0658 percent to 161.5317 points on Friday.
Turnover grew 3.00 percent to 1.954600 trillion yuan for the day, contributed by 253.328 billion yuan in cash bonds trading, 1.699372 trillion yuan in pledged and outright bond repos transactions and 1.900 billion yuan in bond lending.
On Friday, China's bond market players have basically digested the negative impacts from Chinese central bank's reported directive repos to some large banks, but as there were no other delightful news, they generally chose to wait and see, which ended in the bearish bond market by closing.
Interbank Treasury yields, which move inversely with their prices, mostly squirmed up 0.18-3.02 basis points (bp) on Friday.
Interbank financial bonds were diappointing on Friday and their yields generally climbed 0.02-4.52 bps over Thursday.
Policy bank here refers to the Agricultural Bank Development of China and the Export-Import Bank of China, both of whose bonds can enjoy zero risk weighting until maturity.
China Development Bank is an ex-policy bank and the second largest Chinese bond issuer following China's Ministry of Finance who sells Treasury bonds in China. Its bonds sold before the end of 2015 can enjoy zero risk weighting.
Interbank debenture bonds were the worst performing sector on Friday and the averaged yields for AAA-rating corporate bills strode up 4.00-7.59 bps at most.
China money market was little changed on Friday. The benchmark 7-day Shanghai Interbank Offered Rate (Shibor), a quasi of Libor, crept up 2.00 bps to 1.9720 percent over Thursday.
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