Chinese yuan-denominated assets are becoming increasingly prominent in the portfolios of foreign investors as they remain upbeat about China's long-term prospects, an official said on Friday.

Overseas holdings of Chinses mainland bonds rose 166.6 billion U.S. dollars last year, Wang Chunying, a spokesperson for the State Administration of Foreign Exchange, told a press conference.

Overseas holdings of bonds and stocks together registered a net increase of over 700 billion dollars during the 2018-2021 period, with an average annual growth rate of 34 percent, data shows.

"Yuan-denominated assets are gaining more traction among overseas investors as the country's financial market opens wider," Wang said.

The capital inflow from overseas, especially through direct and long-term investments, is a hallmark of China's long-run economic prospects and market potential, the spokesperson said.

"In a portfolio of international assets, adding yuan-denominated assets can help diversify risks," Wang said.

Official data shows that overseas capital accounted for 3 to 5 percent of China's bond and stock markets from 2018 to 2021, which is a relatively low level compared with economies such as Japan, the Republic of Korea and Brazil, leaving the potential for further inflow.