The month of February saw offshore investors further extend their holdings of Chinese debt.
In February the face value of renminbi bonds under trusteeship belonging to offshore institutions increased by 95.694 billion yuan (approx. USD$14.79 billion), for the 27th consecutive month of increase, according to data from China’s Central Clearing and Settlement System (CCASS).
In February the face value of renminbi bonds held by foreign institutions reached 3.152469 trillion yuan in total, amidst a rebound in yields on US bonds.
Timothy Ash, Senior EM Sovereign Strategist at Bluebay Asset Management, said to 21st Century Business Herald that long-term investors such as central banks and sovereign investment funds are currently in the process of expanding their holdings of Chinese bonds due to their appeal as comparatively secure safe-harbour assets.
Mark Nash, Head of Fixed Income Alternatives, Jupiter Asset Management, said Chinese bonds were the exception to institutional investors shorting the bond market in the wake of simultaneous gains in yields for both European and US bonds.