2012.05.07 04:12:36 MARKET TALK: China Govt Bonds Flat Amid Tight Cash Condition

0212 GMT [Dow Jones] China government bonds are largely flat amid slightly tightening cash conditions. The Shanghai Stock Exchange government bond index is up 0.04 points at 132.94 in quiet trade, and is expected to consolidate around its current levels. "We aren't optimistic about the outlook for government bonds as there is little room for profit," says a Shenzhen-based trader at an asset management firm. "Given the long-term inflationary pressure, the central bank will likely keep the cash condition slightly tight," he says. A 20-year bond issued in 2003 is at CNY98.10 vs CNY98.15 Friday, with the yield at 3.6205% vs 3.6148%; another 20-year bond issued in 2001 is at CNY105.91 vs CNY105.84 Friday, with yield at 3.4718% vs 3.4804%. (rose.yu@dowjones.com) Contact us in Singapore. 65 64154 140; MarketTalk@dowjones.com (END) Dow Jones Newswires May 06, 2012 22:12 ET (02:12 GMT)