Overseas investors are cranking up holdings of Chinese government bonds with an eye on yields and safety, said a report by the Wall Street Journal on Monday.

Chinese government bonds are both defensive and offer some yield, said Evan Brown, head of multi-asset strategist with UBS Asset Management.

Switzerland-based private banking group Lombard Odier has created a separate category for Chinese debt products and raised its holdings of Chinese government bonds, according to the report.

We see China as a safe haven for government bond issues, said Stephanie Monier, chief investment officer at Lombard Odier.

Trading of locally denominated Chinese government debt in Europe's secondary market jumped in the second quarter, said the report citing bond trading platform MarketAxess.

Overseas investors added 238.2 billion yuan (34 billion U.S. dollars) of holdings of Chinese government bonds in the second quarter of 2020 and the holdings by foreign investors totaled 2.196 trillion yuan by the end of June, surging 33.48 percent year on year, according to data issued by China Central Depository and Clearing Co., Limited in early July.

(CGTN)