Thailand's central bank aims to increase holdings of Chinese bonds and add overseas corporate debt to its US$179 billion of foreign-exchange reserves as it seeks to boost returns.
"We fully invested the quota from the Chinese authorities and we feel that we need more diversification in our international reserves," Bank of Thailand Deputy Governor Pongpen Ruengvirayudh said in an interview in Bangkok on Thursday. "Yuan yields are higher than in developed markets. This year will be the year we are investing more in new emerging-market assets."
The Bank of Thailand currently has a seven billion yuan ($1.1 billion) allocation for bond purchases and has a $300 million quota to buy onshore yuan debt under China's Qualified Foreign Institutional Investor program, known as QFII. The monetary authority's holdings of yuan-denominated notes are "very close" to the QFII limit, Pongpen said.
This article is older than 60 days, which we reserve for our premium members only.You can subscribe to our premium member subscription, here.