SHANGHAI (Reuters) -Index provider FTSE Russell has given its final approval for Chinese sovereign bonds to be included in its flagship bond index from later this year, setting the stage for billions of dollars of inflows into the world’s second-largest economy.
But a longer-than-expected inclusion period – of 36 months, rather than one year, as FTSE had previously announced – reflects persistent concerns among some global investors about investing in the world’s second-largest bond market.
Chinese government bonds (CGBs) will be added to the FTSE World Government Bond Index (WGBI) over three years from the end of October, FTSE Russell said in a statement released after the U.S. market close on Monday.
Japanese investors, including Japan’s 172 trillion yen ($1.56 trillion) Government Pension Investment Fund