Amid concerns over illiquid credit market in China, bonds issued by the government and the policy banks are an attractive option, argues Wilfred Wee, China fixed income portfolio manager at Investec Asset Management.
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Amid concerns over illiquid credit market in China, bonds issued by the government and the policy banks are an attractive option, argues Wilfred Wee, China fixed income portfolio manager at Investec Asset Management.
The inclusion of China’s onshore bonds on the Bloomberg Barclays Global Aggregate Index is seen as a positive development, but don’t expect a surge of capital in the short-term, managers said.
The slow development of Bond Connect and muted investor interest may delay the inclusion of Chinese bonds in global indices, according to industry sources.
Three global indices are considering including China’s onshore bonds on their indices, which has the potential for strong capital inflows.
Chinese onshore bonds could be included in global benchmark indices as soon as this year, said Carmen Ling, Standard Chartered Hong Kong global head of RMB solutions for corporate and institutional banking.
UK-based Insight Investment has become the first overseas financial institution to access China’s interbank bond market.
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