Topic
The Chinese yuan, also known as the renminbi, is already convertible under the current account - the broadest measure of trade in goods and services. However, the capital account, which covers portfolio investment and borrowing, is still closely managed by Beijing because of worries about abrupt capital flows.
De facto central bank aims for first-mover advantage through blockchain technology, providing welcome lift to Hong Kong’s image as global financial centre
Close ties with mainland China have led to the latest unflattering report card from the ratings agency, but city can prove it wrong.
Recent deal between China and Saudi Arabia is an important step as world wakes up to the consequences of denominating almost all global trade in the American currency.
- Most under threat by a sudden deterioration of the yuan are the currencies of Asian neighbours such as South Korea and Thailand
- A suddenly weaker yuan may have a much wider impact, turbocharging renewed strength in the dollar, the traditional wrecking ball for developing nations
The numbers do not lie, Hong Kong’s financial regulators told the HSBC Global Investment Summit on Tuesday. The city’s market has shown resilience and competence through several years of economic headwinds.
In an uncertain monetary environment where the US Federal Reserve has yet to announce interest rate cuts, China’s central bank is seeing potential moves to increase activity constrained by pressures on the yuan.
Even after President Xi Jinping has asked for China’s central bank to trade government bonds, the outcome is likely to remain limited as the bank does not want to trigger negative outcomes for inflation and exchange rates.
Beijing’s new off-budget treasury bonds will span decades, and they have been sold only 3 times before – in some of the most challenging economic times.
People’s Bank of China (PBOC) has named two new academic advisers for its monetary policy committee, which submits advice to the State Council on key moves including interest rate changes and the value of the yuan.
AIA Group’s new sales in Hong Kong and mainland China continued to grow in the first two months of the year, indicating strong momentum from last year is carrying over in its two major markets, according to its top boss.
Two years after the invasion of Ukraine isolated Russia from the Western financial system, major energy and mining companies have come to rely on the yuan for most of their foreign-currency needs
High-profile economist and former State Council researcher warns that potential US capital injections in China, following any Fed rate cuts, might be tumultuous for already-battered markets.
Analysts say that while enhanced financial ties between the two countries could help internationalise China’s currency, Beijing tends to play it safe when upholding its neutrality regarding the war in Ukraine.
HSBC, Standard Chartered and Hang Seng Bank are rolling out more products tied to the Wealth Management Connect scheme amid a drive by Beijing to boost the Greater Bay Area’s financial markets.
China’s next big impending change in the financial market is letting more foreign institutional investors into its onshore repo market.
China’s latest act is to invite more foreign players to its US$232 trillion onshore repo market. As a precursor, Hong Kong will treat Chinese government bonds and policy bank bonds as eligible collateral in its yuan liquidity facility.
Hong Kong is set to continue capitalising on offshore yuan funding opportunities after ‘dim sum’ bonds and loans – offshore debt denominated in the yuan – grew exponentially in 2023, regulators say.
Policy sales have been boosted by the reopening of the mainland border, a weakening yuan and the interest rate gap between China and the United States, the Insurance Authority says.
Hong Kong Financial Secretary Paul Chan says stronger links between city’s financial sector and rest of Greater Bay Area being forged.
People’s Bank of China (PBOC) is set to leave the rate on its one-year policy loans – the medium-term lending facility (MLF) – steady at 2.5 per cent on the first working day after the Lunar New Year holiday ends.
With the former president seemingly a lock for the Republican nomination, investors are preparing for a possible return to the days of the US-China trade war which steamrollered the yuan during his term in office
China has the world’s largest foreign exchange reserves, but some have argued Beijing needs to reduce its size, while others believe having a sizeable holding remains important.
Russian central bank governor Elvira Nabiullina says the yuan’s share in Russia’s exports has increased from 0.4 to 34.5 per cent, replacing the US dollar and euro as its ‘primary’ currency for foreign economic activity.
The government is actively engaging with mainland Chinese regulators to speed up the approval process for companies listing in the city. Measures will also be rolled out to attract family offices and wealthy individuals.
China imported a record high 1,447 tonnes of gold for non-monetary use last year, with the middle class attempting to preserve their dwindling fortunes caused by the property market crisis and slumping stock market.
The new policies relaxed cross-border payment rules between the 11 cities of the Greater Bay Area to make it easier for the residents of Hong Kong and Macau to buy homes in southern China.
De-dollarisation bid begins to pay off as China and Africa increase use of the yuan and local currencies in trade deals.
Potential US rate cuts this year will redirect capital to Asia, boost the yuan and create demand for yuan products, Standard Chartered’s John Thang says. Hong Kong’s efforts to promote family offices and the investment migration scheme will act as catalysts.
China is continuing to encourage the international adoption of the yuan, but drastic measures seem unlikely as a ‘prudent, steady’ approach has been advised.
China is set to meet its growth economic target of ‘around 5 per cent’ this year, but potential depreciation pressure on the yuan is set to limit Beijing’s options to respond to a potential slowdown next year.
