A record amount of money poured into China's financial markets in 2018 — and analysts say that figure will likely increase as closely followed indexes raise their weightings for Chinese assets.
China's bond and stock markets experienced inflows of $120 billion last year and that amount could reach $200 billion this year, boosted by the inclusion of Chinese assets in benchmark indexes, according to a report by Citi.
"Inflows from bonds and equities are likely to continue supporting China's (balance of payments)," the U.S. bank said in its Jan. 31 report.
While financial markets in China remain highly regulated compared to those of advanced economies, the door has been gradually opening and investors are keen to get in as opportunities increase.
Chinese A-shares — or yuan-denominated stocks traded on the mainland — were included in the MSCI Emerging Markets Index for the first time last year, allowing investors to access the Chinese equity market more easily. Now, MSCI is considering whether to further increase the weighting of A-shares in its indexes, and could announce its decision by the end of this month.
Meanwhile, financial information firm Bloomberg announced in January that yuan-denominated Chinese government and policy bank securities will soon be included in its bond benchmark — the Bloomberg Barclays Global Aggregate Index.