Chart of the Day: Growth in Offshore Holdings of Chinese Bonds Dips to 20-Month Low

Overseas investors seem more hesitant to hold more Chinese debt amid a surge of bond defaults and a sluggish economic outlook.

In October, the net increase in holdings of onshore yuan-denominated bonds by offshore institutions dipped to a 20-month low of 253 million yuan ($36.49 million), according to data from China Central Depository and Clearing Co. Ltd., one of the country’s major clearing houses.

Graphic: Gao Baiyu/Caixin

As of the end of October, offshore institutions held more than 1.44 trillion yuan worth of Chinese bonds.

China has introduced multiple measures to lure overseas money to its bond market in recent months. For instance, offshore institutions have been exempt for three years from paying corporate tax on trading income and value-added tax on interest from Chinese bonds. The policy took effect on Nov. 7, according to (link in Chinese) the Ministry of Finance.

Contact reporter Lin Jinbing (jinbinglin@caixin.com)