A wave of private savings of up to $1,300bn could flow out of China into global bond and equity markets once individual Chinese investors gain more freedom to invest offshore, according to Capital Economics, a consultancy in London.

Last week, Beijing relaxed rules to allow mainland investors to buy shares directly on the Hong Kong stock market. Since then, the city's benchmark Hang Seng index has powered ahead to erase all of last month's losses from the global credit turmoil. Yesterday, it rose 2.9 per cent while a number of stocks trading at wide discounts to their mainland counterparts reached record highs on expectations of heavy buying by mainland investors.