China’s 10-year government bond yield inched lower to around 1.70% on Monday, marking its third-session losing streak, as markets digested fresh policy signals from the People’s Bank of China. On Friday, the central bank announced a new financial stability committee and reaffirmed its commitment to an “appropriately loose” policy stance, aiming to maintain ample liquidity and guide reasonable credit growth in the second half. It also pledged to resolve risks in key regions and support local government financing platforms. While yields declined, bond sentiment remains pressured by rising equity inflows, tempering the downside and reinforcing one of the strongest equity–bond divergences since the pandemic. Looking ahead, markets are focused on October’s political plenum, where leaders are expected to address deflation, overcapacity, and the prolonged property downturn. Markets also turn to trade and inflation data, amid concerns over a US-China tariff truce still awaiting final approval.