Global Demand for China Bonds Cools as Yield Premium Shrinks
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Overseas demand for China’s onshore bonds grew at a slower pace in January, in a possible sign that appetite could wane as the nation’s yield premium shrinks.
Foreign institutional investors bought a net 66.3 billion yuan ($10.4 billion) of Chinese securities in the interbank market last month, compared to 69.8 billion yuan of purchases in December, according to Bloomberg’s calculation based on Chinabond and Shanghai Clearing House data. They boosted holdings of sovereign bonds and banks’ short term debt, while cutting positions in policy bank notes.