China 10Y Yield Holds Near 5-Week High

China’s 10-year government bond yield held steady around 1.78% on Monday, hovering near its highest level in five weeks, as markets assessed mixed economic and geopolitical signals. On the data side, China’s factory activity returned to growth, rising to 50.5 in August from 49.3 in July and above forecasts of 49.5, the strongest reading since March. Output expanded as new orders and purchasing activity picked up, while the contraction in foreign demand eased, though the rebound was seen as modest. Meanwhile, global sentiment was shaped by a US federal appeals court ruling that most of President Trump’s reciprocal tariffs were illegal, with judges saying he had exceeded his authority in imposing sweeping levies announced in April. Investors also tracked India-China ties after leaders from both countries reaffirmed they are partners in development rather than rivals during a two-day SCO summit, where President Xi is expected to deliver remarks.