In 2026, local government bonds will "open the floodgates," with local plans to issue bonds exceeding 1 trillion yuan in the first quarter

The issuance of local bonds in 2026 has "opened the floodgates." According to information disclosed by the Shandong Provincial Department of Finance, Shandong issued 72.381 billion yuan in local bonds on January 5, making it the first province to issue local bonds this year. Feng Lin, Executive Director of the Research and Development Department at Dongfang Jincheng, stated that this year's fiscal policy continues to exert force early on, and the peak of issuance for the entire year may occur in the second quarter. Considering this year's deficit scale and various funding needs at the local level, the net supply of local bonds for the year is expected to reach approximately 7.8 trillion yuan.

From the first quarter local bond issuance plan, as of December 31, 2025, the disclosed issuance scale for local bonds in the first quarter of 2026 exceeds 2.1 trillion yuan. Although this is still lower than the actual issuance scale of 2.8 trillion yuan for local bonds in the first quarter of 2025, it is significantly higher compared to the same period in previous years, and the actual issuance scale is expected to exceed this level. (Shanghai Securities Journal)