China focus: The future of renminbi trade

Opinions vary on how much of an impact a lack of investment opportunities will have on trade settlement.
Ben Chan, HSBC
Ben Chan, HSBC

Hong Kong’s renminbi trade-settlement scheme might be growing quickly, but it faces an uncomfortable truth deposits in Hong Kong renminbi, or CNH in bankers’ jargon, heavily outweigh the city’s available pool of renminbi assets by more than four to one. That leaves many would-be opportunists with a tough question what to do with their renminbi

CNH deposits have increased to Rmb407 billion $62.2 billion, as of February 2011. Opportunities to invest CNH, however, are limited principally to renminbi-denominated Hong Kong-issued bonds. But with a total outstanding amount of about Rmb95 billion of these so-called dim sum bonds, they account for less than a quarter of CNH deposits.

...
¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team subscription (2-5 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at [email protected], or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team subscription (2-5 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at [email protected], or +(852) 2122 5222