Update | Hong Kong’s businesses more upbeat than global peers about yuan’s stability, HSBC poll says

Hong Kong’s businesses are overwhelmingly more upbeat than their global peers about the prospects and the stability of the renminbi, even as the Chinese currency weakened to a six-year low against the US dollar, according to a survey by HSBC.

Up to 61 per cent of Hong Kong’s businesses surveyed are confident the Chinese currency will become less volatile over the next 12 months, compared with 31 per cent of worldwide companies polled, HSBC said, citing its survey of 1,600 companies across 14 global markets.

“With the rapid growth of RMB-denominated trade settlement in recent years, Hong Kong

businesses have developed a strong understanding of the foreign exchange market and have

become more sophisticated at managing foreign exchange risk,” said Albert Chan, head of commercial banking Hong Kong at HSBC.

Onshore yuan in Shanghai traded Tuesday at 6.7121 against the dollar, 0.11 per cent or 73 basis points weaker than on Monday, its weakest level since September 2010. Offshore yuan also dipped 0.08 per cent or 62 basis points to 6.7211 against the greenback, approaching the low level in January of 6.75 per dollar.

The declines follow the increasingly lower reference points set by the People’s Bank of China, even after the yuan officially became a member of the International Monetary Fund’s Special Drawing Rights (SDR) basket on October 1. The reference point was set at 6.7098 per dollar, down 90 basis points or 0.13 per cent lower than on Monday.