Investment strategies will have to cope with the risk-on risk-off phenomenon.
Group Chief Economist Stephen King explains why governments increasingly resort to using financial repression to fund high debts.
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HSBC in the forefront of Offshore RMB Business
Learn more about the opportunities and risks of the rapidly expanding market for China's currency.
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RMB resource centre
A new global currency is emerging,
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Introduction to the RMB
RMB internationalisation was initiated in July 2009 with the launch of the RMB Cross-Border Trade Settlement Pilot Scheme by mainland China authorities, under which cross-border RMB transactions are permitted for a variety of current and capital account purposes.
That initiative, and further liberalisations since, has led to a rapid uptake in the use of renminbi for cross-border transactions and the formation of a thriving offshore RMB market.
In April 2012, HSBC announced the first international renminbi-denominated bond outside Chinese sovereign territory.
We are witnessing the development of a major world currency for trade settlement, offshore and cross-border savings and investment, and ultimately, a new reserve currency.
Video Centre
Related resources
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HSBC announces an
RMB firstHSBC Bank plc launched the first international RMB-denominated bond to be issued outside China – a significant advancement in internationalising the currency and developing London as an offshore RMB centre.
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London as a centre for international renminbi
businessThe City of London initiative to develop London as a thriving offshore RMB centre was launched on 18 April 2012.
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London Stock Exchange welcomes first RMB-denominated bond
The renminbi-denominated HSBC bond, which raised RMB2 billion (GBP196 million) at issue, marks a significant
step in internationalising the currency.
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Download Week in China
Get up to speed on one of the world's fastest growing economies: connect to Week in China – an online, subscription-based publication with a weekly digest of business news.
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Osborne sees red
British Chancellor of the Exchequer George Osborne is aiming for the UK to become 'the home of Asian investment in Europe' and for London to be Europe's next renminbi hub.
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Investors' top ten questions about the renminbi
Paul Mackel, HSBC's Head of Asian Currency Research, provides answers to the top ten questions about the offshore renminbi market and what lies ahead for the Chinese currency.
Why is RMB important to you?
- The use of renminbi for trade settlement will make Chinese importers/exporters more competitive by lowering their costs and exchange-rate risks – thus, the export recovery in China is likely to be quicker and stronger than in many other countries in the near future
- Combined with initiatives to allow foreign companies to issue RMB bonds and initial public offerings (IPOs), this implies a sharp slowdown in China’s dollar accumulation in the coming years
- The plan implies a policy preference for steady appreciation of renminbi over time, creating interesting investment opportunities
- Expanding RMB cross-border trade elevates the importance of foreign exchange (FX) hedging for corporates globally
- Hong Kong will be best positioned to benefit as the current top offshore centre for RMB
