China: Record foreign investor inflows in September - ANZ

Research Team at ANZ, notes that the September saw record foreign investor inflows into China bonds totalling USD11.5bn and of those, USD6.2bn was in CGBs, with the rest in PFBs.

Key Quotes

“The strong foreign demand could be due to the RMB’s inclusion in the IMF’s SDR basket from 1 October. Foreign ownership of CGBs reached another record high of 3.7% (from 3.4% in August), while foreign ownership of PFBs rose to 2.3% from 2.0% the previous month, still shy of the high of 2.5% attained in January 2015.

The last available data on equity assets held by foreigners was for June. ETF inflows into China equities were strong in Q3 as a whole, showing a significant pickup from Q2. This suggests the PBoC data on foreign equity ownership likely increased, though not to the extent of the bond flows.”