A consensus is forming among players in the still nascent renminbi-denominated bond market. Alternatively called the CNH market, or colloquially the dim sum market, Chinese offshore bonds are appealing to both investors and potential issuers.
The size of the offshore renminbi market has surged from Rmb36 billion in 2010 $4.6 billion to Rmb110 billion today, attracting new investor participation that is likely to expand further.
Until mid-2011, the appreciation of the renminbi was a one-way-bet, so the market was mainly a currency play for investors who would tolerate low coupons. That concession meant that borrowers could access cheap funding. But perceptions about the trajectory of the currency...
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