January 31, 2019 / 5:21 AM / 10 months ago

UPDATE 1-Bloomberg confirms China bonds inclusion in Global Aggregate Index

(Updates with PBOC comment)

HONG KONG, Jan 31 (Reuters) - Bloomberg said on Thursday that Chinese yuan-denominated government and policy bank bonds will be added to the Bloomberg Barclays Global Aggregate Index.

The inclusion will begin in April and continue over a 20 month period, Bloomberg said.

The index provider announced its intention to include Chinese bonds in its benchmark index last March, but said authorities needed to make several improvements to markets, such as the ability to allocate block trades across portfolios.

Bloomberg said in a press release on Thursday that these “operational enhancements” have now been fulfilled by the People’s Bank of China (PBOC), Ministry of Finance and State Taxation Administration.

The PBOC said in a statement on Thursday the confirmation of the inclusion reflected global confidence in the Chinese economy and would “better fulfill international investors’ allocation demand for renminbi assets.”

The index would include 363 Chinese securities, representing 6.03 percent of the $54.07 trillion index, and make local currency Chinese bonds the fourth largest currency component in the benchmark, according to Bloomberg. (Reporting by Noah Sin; Editing by Sam Holmes)

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