A Chinese investment company based in mainland China has bought $200 million worth of two-year Korea treasury bonds this week, said a source with direct knowledge of the matter, suggesting an inflow of Chinese investment into Asia’s fourth largest economy.
“A Chinese entity has bought won-denominated treasuries on the 22nd and the 23rd, which is a first time for that company,” the source said, asking not to be named due to the sensitivity of the matter. “I expect more of similar coming from Chinese funds.”
South Korean authorities do not disclose purchases of local bonds by other countries, and any Chinese buying of won-denominated bonds are rarely reported due to the impact it has on the local bond market.
While foreign holdings of U.S. Treasuries increased in May to top $9 trillion for a third straight month, China further reduced its U.S. holdings to $756.3 billion in the same month, the lowest since February 2009, data from…
