BEIJING, Aug. 19 (Xinhua) – Foreign institutions kept adding their RMB-denominated bond holdings this year, making the type of assets a new "safe haven" for external investors, reported sector portal Securities Daily.
Statistics with China Central Depository & Clearing Co., Ltd. (CCDC) showed that RMB-denominated bonds held by foreign institutions surged to 2.34 trillion yuan, an increase of 148.11 billion yuan from June.
Compared with the end of 2019, their RMB-denominated bond holdings rose 24.89 percent, marking the 20th month of consecutive holdings increase.
Tao Jin, senior researcher with Suning Institute of Finance said Treasury bond yields in many countries where quantitative easing policies prevail have dropped to extremely low or even negative levels.
Under such circumstances, China's around 10-year T-bonds with around three percent yields turn out to be rather attractive for long-term buyers both at home and abroad, noted Tao, adding that China's loosened quota restrictions and better facilitations for foreign investment in China's bond market reduced indirectly transaction fees of foreign investors and improved in turn their investment returns.
Cui Zhijuan, professor with Beijing National Accounting Institute said hefty holdings increase by foreign institutions in July reflected their confidence in the Chinese economy and further improvement of their preference towards RMB-denominated assets, after China's economic and production recovery generated notable achievements in June. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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