Overseas institutions are massively increasing their holdings of Chinese government bonds, with global funds rushing to place their bets on Chinese bonds.

Against the backdrop of escalating volatility in the global financial markets, international capital is continuing to accelerate its allocation in Chinese bond assets. In May, foreign institutions increased their holdings of Chinese government bonds by a net 61 billion yuan compared to the previous month, marking the largest monthly increase since December 2023. According to data from the China Foreign Exchange Trading Center, in May, foreign institutional investors completed spot transactions of bonds totaling 1.4048 trillion yuan, with purchases of 781.3 billion yuan and sales of 623.5 billion yuan, resulting in a net purchase of bonds across all categories amounting to 157.8 billion yuan. As of the end of May this year, the total size of bonds held by foreign institutions in the interbank market reached 3.21 trillion yuan, with Chinese bonds accounting for 62.3%, equivalent to around 2 trillion yuan.