China, HK garner net fund inflows over US$44b

China and Hong Kong attracted about US$44.3 billion (HK$345.5 billion) in net fund inflows between April and late July, the Hong Kong Monetary Authority said, expressing confidence in the outlook for the city’s asset and wealth management markets.

This reversed earlier net outflows of approximately US$10.6 billion recorded between January and March, according to fund-tracking firm EPFR.

Uncertainties are prompting international investors to adopt more proactive diversification strategies, with China-related and yuan assets increasingly taking up a larger share of their portfolios, HKMA chief executive Eddie Yue Wai-man said in his blog.

A large portion of the inflows came from traditional funds in Europe and the US, mainly targeting Chinese bonds, with about 50 to 60 percent channeled via Hong Kong’s Bond Connect, according to HKMA executive director (external) Kenneth Hui Wai-chi.

"The mainland’s economic growth and wealth accumulation, along with enhancements and expansions to various Connect Schemes, will further broaden the client base for Hong Kong’s wealth management industry," Yue said.

The city is aiming to become the world’s largest wealth management center by 2028.

STAFF REPORTER