China will connect its interbank and exchange bond markets, the People's Bank of China (PBOC), the country's central bank, said on Sunday, a move to unify segregated bond markets and facilitate monetary policy transmission and macro economic management. 

Qualified investors will be allowed to buy and sell bonds traded in each other's markets via the "connect" infrastructure, the PBOC said in a statement. 

The interbank bond market, formed in 1997 and supervised by the central bank and dominated by banks, is much larger than the exchange bond market in terms of issuance and trading volume. 

The exchange bond market is regulated by the China Securities Regulatory Commission and counts investors such as brokerages, investment funds and individuals as participants. 

By end-2019, China's total outstanding bonds reached 99.1 trillion yuan (143 billion U.S. dollars), with interbank bonds of 86.4 trillion yuan, or 87.2 percent of that total, according to central bank's data. 

In 2018, China's central bank pushed to unify bond rating qualifications in the interbank and exchange bond markets, the first step toward breaking the barrier between the two markets.