China’s Yield Discount to Treasuries Reaches Widest Since 2002

The yield discount on China’s bonds versus US Treasuries grew to the most in 22 years as Beijing signaled further interest-rate cuts to shore up the economy in the face of potential US tariffs.

China’s 10-year yields have fallen 245 basis points below those on similar US bonds. That happened as Chinese yields plunged to a fresh record low this week after the Communist Party’s top decision-making body pledged “moderately loose” monetary policy in 2025 in its first policy pivot in nearly 14 years.