Bloomberg has gone where MSCI feared to tread, becoming only the second major index provider to include China’s onshore markets in widely-followed benchmark indices in a move that could prompt rivals to follow suit.
China is home to the world’s second-largest stock market and the third-largest bond markets, but its tight control of onshore activity has made its inclusion in flagship indices contentious, with many investors arguing that it must relax its grip before they can invest comfortably.
On Wednesday, Bloomberg said its Bloomberg Barclays bond indices would create a parallel index that incorporated onshore Chinese government bonds and some bank debt into its flagship global aggregate index, while also maintaining its current, renminbi-free global benchmark.