China’s 10‑year bond yield slipped to 1.67 per cent, its lowest since July last year, as weak industrial output and consumer spending data pushed investors into sovereign debt.

Strategists attribute the move to a lack of credit demand. Leonard Kwan of T Rowe Price said it reflects softer recent data, while Eric Robertsen of Standard Chartered noted private firms aren’t borrowing or hiring and consumers aren’t spending.

Wei Li of BNP Paribas added that low loan take‑up, low deposit rates and a shortage of bonds are driving demand. Meanwhile, Mansoor Mohi‑uddin of Bank of Singapore highlighted the striking divergence: Chinese yields fall while US 10‑year Treasuries rose to 4.74 per cent and Japanese bonds to 2.93 per cent.

Hui Shan of Goldman Sachs expects China’s rates to stay low because savings exceed investment demand, though the decline will be gradual due to banks’ margin concerns.