oing supply-side structural reform, as it is still dominated by the 268-trillion-yuan banking system, the analysts said.
The restructuring process will accelerate as more foreign capital
moves in, which can boost competition in the domestic market, the analysts added.
In the medium term, continued financial reform and more opening-up measures co
uld boost capital inflows, said Lillian Li, a vice-president at rating agency Moody’s.
But trade disputes between China and the United States and uncertainty over monetary policy in global markets may dam
pen capital inflows, and the pace of capital inflow is likely to fluctuate in the near term, she said.
Having the world’s second-largest equity market and the third-largest bond market, China will likely usher in more inte
rnational capital flows in the longer term, if the nation further liberalizes its financial system, she added.