FOREIGN investors held a record amount of Chinese yuan bonds at the end of May, official data showed, as a strengthening yuan increased the appeal of Chinese assets.

Holdings by offshore investors of bonds traded in China’s interbank market stood at 3.68 trillion yuan (US$575 billion) at the end of May, according to calculations using data released Friday evening by China Central Depository & Clearing Co. and the Shanghai Clearing House.

That was up 1.7 percent, or 61.47 billion yuan, from a month earlier.

Offshore investors held a record 2.12 trillion yuan in Chinese government bonds at the end of May, up 1.2 percent from April and accounting for 10.4 percent of all outstanding Chinese government bonds.

The yuan strengthened more than 1.6 percent against the U.S. dollar in May, supported by the country’s robust economic recovery and capital inflows.

In recent weeks, China has mounted a coordinated effort to cool expectations of a stronger yuan through warnings about one-sided bets on yuan appreciation and regulatory steps to stem the yuan’s rise.

Xinhua said in a commentary Wednesday that yuan-denominated assets are not a “bargaining chip” for gamblers, in an attempt to curb speculative bets on a further rally in the currency.

(SD-Agencies)