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NEW YORK: FTSE Russell will add Chinese government bonds to its flagship World Government Bond Index (WGBI) beginning in 2021 and pending confirmation in March, the index provider said Thursday.
Chinese government bonds, a $ 1.5 trillion market, are already part of the JPMorgan and Bloomberg Barclays index suites.
But the FTSE WGBI has a much larger passive band of investors who follow it.
Goldman Sachs estimates that there is $ 2.5 trillion of global cash after the WGBI, and the listing of China could generate $ 140 billion in mainland bonds during the listing period.
Malaysian bonds will remain on the watch list, FTSE Russell said.
FTSE Russell also downgraded Argentina’s stock exchange to “unclassified” from “frontier market” on Thursday as capital controls remain in place in the South American country.
Vietnam will remain one more year on the equity index watch list for a possible upgrade to “emerging secondary market” from “frontier market,” FTSE Russell said.
Shares of Russia were added to the equity index watch list for a possible reclassification from “secondary emerging” to “advanced emerging”.
– Reuters
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