Overseas investors raised their holdings of Chinese bonds for the 27th month in a row in February despite a narrowing spread between Chinese government bonds and their foreign counterparts.

Overseas investors held a total of 3.15 trillion yuan (about 486.4 billion U.S. dollars) of Chinese bonds by the end of February, rising 3.13 percent from a month earlier, data from China Central Depository & Clearing Co. Ltd. showed.

Market transactions were also robust, with trading volumes among foreign investors amounting to 671.8 billion yuan last month.

With a strong rebound in the fourth quarter, China's economy expanded 2.3 percent in 2020, becoming the only major economy to achieve positive growth in the pandemic-ravaged year.

Although the yield of foreign long-term government bonds had seen a notable rise since late January, the narrowing spread had not yet incurred visible impacts on foreign purchase of Chinese bonds.

Data from financial service provider Wind showed as of March 2, the spread between Chinese 10-year government bonds and their U.S. counterparts came in at 183 basis points, narrowing from the 249 basis points seen in November last year.

As the pandemic gradually came under control and economic recovery gained steam, the monetary easing policies in major economies may exit, which is likely to bring changes in capital flows, the Chinese central bank said in a recent policy report, warning against related risks.

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