The unexpected action is intended to tamp down a potential bubble in the bond market fueled by investors shunning riskier assets like stocks and real estate.

China's central bank suspended treasury bond purchases on Friday, briefly lifting yields and spurring speculation it is stepping up defence of the yuan currency which has been sliding since the election of Donald Trump as U.

The move comes as long-term yields on Chinese bonds hit fresh lows amid expectations of more monetary policy easing.