Foreign Buying of Chinese Bond Surges Second-Most on Record
- December purchases followed net selling the previous month
- China sovereign notes among best-performing bonds last year
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Foreign investors boosted their holdings of Chinese debt last month by the most since June -- reversing November’s net-selling trend -- as the yuan rallied and bond yields fell.
Overseas funds added 82.7 billion yuan ($12 billion) -- the second highest increase since data became available in 2014 -- to hold a total 1.5 trillion yuan of onshore bonds by the end of December, according to the China Central Depository & Clearing Co. The yuan reversed seven months of declines toward the end of the year, rising on hopes a trade deal might be reached with the U.S. Lower hedging costs and a rally in bonds may have also helped drive inflows.