On 27 May 2022, the People’s Bank of China, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange jointly issued an announcement on “Matters Concerning Further Facilitating Foreign Institutional Investment in China’s Bond Market” (關于進一步便利境外機構投資者投資中國債券市場有關事宜, hereinafter referred to as the “Matters”).
A highlight of the Matters is that foreign investors’ access to China’s bond market will be extended to the exchange bond market.
Previously, foreign investors mainly invested in China’s bond market through the Bond Connect and the CIBM Direct. These funds were not allowed to enter the exchange bond market but only the interbank market.
The Matters not only expands the investment scope of China’s bond market available to foreign investors, but also diversifies the types of qualified foreign investors in China’s domestic exchanges. Foreign central banks, sovereign funds, certain banks, and insurance companies, which were only allowed to invest in the interbank market before, can also trade on the exchange bond market since now.
Cover Photo by Zhipeng Ya on Unsplash
Contributors: CJO Staff Contributors Team
