China opens the market and lures with bonds

The Pudong financial district in Shanghai
Image: Reuters

Because of its size, western investors will have to become more involved in the Chinese market in the future. Concerns about the trade conflict with the United States are by no means curbing stock demand.

D.he latest figures on China’s economic growth did not meet all expectations, but they were far from disappointing. “China is the only major economy in the world that comes out of the Corona crisis relatively unscathed,” was the verdict of Jörg Zeuner, chief economist at Union Investment, the fund company of the Volks- und Raiffeisenbanken. In the third quarter, in his view, the picture of a V-shaped economic recovery in the Middle Kingdom solidified. This gives Chinese securities a tailwind.

This not only applies to stocks, but increasingly also to bonds. They have become increasingly important for foreign investors this year because the market in the People’s Republic is gradually being opened up to them. It is the second largest bond market in the world after the United States with a volume of 16 trillion dollars. Foreign investors are currently holding 2.7 percent of this, which can certainly be increased significantly.


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