Offshore buyers lift China bond holdings for ninth month in November

Foreign investors increased their holdings of Chinese bonds for a ninth consecutive month in November, adding to positions in government bonds and some policy-bank bonds as a domestic sell-off led to a surge in yields. Holdings of Chinese treasury bonds by overseas investors rose 14.4 billion yuan in October to 573.5 billion yuan ($86.66 billion), according to Reuters' calculations based on data from the China Central Depository and Clearing Co (CCDC), the country's primary clearing house.
After reducing them in October, offshore investors increased their holdings of Chinese policy bank bonds by 1.84 billion yuan to 316.4 billion yuan. Total offshore holdings of all Chinese bonds cleared by CCDC rose by 15.3 billion yuan in November to 936.6 billion yuan.
Following a surge since August, holdings by offshore institutions of negotiable certificates of deposit (NCD), a type of short-term debt popular among smaller banks, fell by 15.7 billion yuan in November to 139 billion yuan, separate data released by Shanghai Clearing House showed. Gary Ng, an economist at Natixis in Hong Kong, said the decline might reflect a maturity wall as NCDs come due. But he added that high yields would continue to make them attractive to investors.