Group 1 - The core viewpoint of the article highlights a dramatic shift in foreign investment attitudes towards Chinese bonds, transitioning from reduction to increased allocation from 2023 to 2025, driven by multiple market factors [2][4]. - In 2023, foreign investors reduced their holdings of Chinese government bonds by approximately 80 billion yuan due to the aggressive interest rate hikes by the Federal Reserve, which pushed U.S. Treasury yields to a 22-year high of 5.5%-5.7%, significantly higher than China's three-year government bond yield of 2.35% [2][4]. - The turning point began in 2024, with a net inflow of 41.6 billion USD into the Chinese bond market, reversing the previous trend of outflows [4]. Group 2 - By May 2025, 1,169 foreign institutions from over 70 countries held Chinese bonds, with an increase of over 270 billion yuan compared to the end of 2024, indicating a significant return of capital [4]. - Foreign investors are focusing on mid-term, high-liquidity assets, particularly increasing their allocation to 3-5 year government bonds, with a net purchase of 144.9 billion yuan year-to-date [5][7]. - The market anticipates that as China's bonds are included in global indices and capital account openness deepens, the proportion of foreign holdings in Chinese bonds may gradually align with the emerging market average of 15%-20% [7].