To increase the attractiveness of RMB (6.7118, -0.0342, -0.51%) assets, we must steadily and actively promote the two-way and orderly opening of the financial market, actively prevent, resolve and effectively deal with various possible market risks, and firmly promote the opening of the financial service industry , to promote the further integration of China and the world.
During the Spring Festival this year, the enthusiasm of global capital for the allocation of Chinese assets has improved significantly. In January, more than 130 billion yuan of northbound funds flowed into the A-share market, and the cumulative increase in foreign capital positions far exceeded the 90 billion yuan inflow of northbound funds for the whole year of 2022. According to data from the Institute of International Finance (IIF), even during the holiday period of the Spring Festival holiday, out of the daily net inflow of US$1.1 billion in emerging markets, about US$800 million went to ETF products and emerging market funds linked to Chinese assets. More and more capital is accelerating the inflow of bulk commodities, crude oil futures and other alternative assets that are highly related to China's rapid economic recovery. It can be said that global investors are giving the best vote of confidence in China's economic growth and social development by increasing their holdings of RMB assets and buying more China-related assets.
Renminbi assets can provide global investors with high-quality channels to share the dividends of China's economic growth and continuous, stable, safe and long-term investment opportunities. More medium and long-term funds, institutional investors and overseas investors enter the Chinese market to invest in various RMB assets, which is conducive to China's implementation of a wider, wider and deeper opening to the outside world and the steady promotion of RMB internationalization, which is conducive to strengthening the Chinese market. The resource allocation efficiency, price discovery function, value investment concept and overall anti-risk ability are conducive to better promoting high-level circulation and high-quality development of technology, capital and industry.
From the perspective of profit, valuation and exchange rate, RMB assets are supported by various positive factors and positive expectations. The latest January PMI indexes also show that the overall economic climate in my country has picked up sharply, and the bottoming trend is gradually emerging. The long-term improvement of the fundamentals of China's economic development and the improvement of the quality and efficiency of the policy are conducive to the increase in the income of related equity assets, the cumulative net value of fixed-income assets, and the return on the underlying assets of alternative investments. At present, the valuation of domestic financial assets is generally at a low level, with long-term investment value, overall risk convergence and overall controllability, forming a virtuous circle of finance and economy, which is conducive to the maintenance of high security and high liquidity of RMB assets in an absolute and relative sense , scalability and stable profitability.
From the perspective of the demand side of RMB assets, considering the long-term asset and safe asset allocation needs of global investors and the continuous, stable, safe and long-term investment opportunities that China can provide, it is expected that RMB assets will be a good investment with low volatility and low volatility. Diversification tools with a smooth process will continue to be watched and held. Compared with the proportion of China's GDP in the world and the proportion of financial assets in the world, the proportion of RMB assets in the world's major financial indexes is still low, and the proportion in the global investor portfolio is expected to continue to increase. Environmental, social and corporate governance (ESG) investments are expected to provide more investment opportunities.
From the perspective of the supply side of RMB assets, with the further simplification of the investment process for foreign investors entering the domestic market, the depth, breadth and liquidity of RMB assets have been further improved, and China's financial market has further transformed from a channel-based opening to a comprehensive, multi-level, With a high-level institutional opening pattern, the financial industry has further realized institutional, systematic, and overall high-level opening-up, attracting global investors to invest in the Chinese market and increase their holdings of core RMB assets.
In order to further enhance the attractiveness of RMB assets, on the premise of ensuring safety and controllability, we must continue to steadily and actively promote the two-way and orderly opening of the financial market, and improve policy support, institutional support, and detailed rules in terms of foreign exchange, taxation, and credit ratings. It is necessary to actively prevent, resolve and effectively deal with the transmission and impact of possible arbitrage behaviors, cross-border capital flow fluctuations and offshore market risks on the onshore market. On the basis of equality and mutual benefit, continue to firmly promote the opening up of the financial service industry, strive to create a market and business environment conducive to fair competition and common development of Chinese and foreign capital, and support and improve the access of foreign-funded financial institutions in terms of the speed of establishment and the breadth of financial license issuance. . Encourage China's real economy, high-quality enterprises, and the financial industry to improve their ability to "go global" to make good use of overseas financial resources and participate in international market competition, and promote the further integration of China and the world.
