The number of Chinese government bonds held by overseas institutions reached 838.89 billion yuan by the end of May. The figure has been climbing for 16 consecutive months, according to the latest data released by the CCDC, Yicai.com reported.

CCDC, the custody and clearing institution for Chinese government bonds, said over the past year, the proportion of overseas institutional holdings of Chinese government bonds has risen from 3.88% to 6.74%.

Insiders think although the Chinese currency yuan has recently depreciated against the US dollar, it is appreciating against most other currencies and yuan assets are still appealing compared to other assets.

In particular, due to the recent political instability in Europe, some funds discharged from Europe are not only finding their way back to the US, but also flowing into China.

In the long term, the yuan’s engagement in SDR, as well as China’s increasing opening up of the domestic bond and interbank markets, will lead to the continuous inflow of funds.