Top Stories

China’s yuan outflows fall

China’s yuan outflows fall

The flood of domestic currency out of China became more of a trickle last month, reports Bloomberg News. An equivalent of a net $900 million worth of yuan left China via payments in December. That’s less than 2 percent of the record amount in September, and compares with an average of $25.8 billion a month last year.
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CLS signs MOU with Chinese think tank

CLS signs MOU with Chinese think tank

CLS Group (CLS), a leading provider of risk mitigation and operational services for the global foreign exchange (FX) market, has signed a memorandum of understanding (MOU) with the National Institution for Financial Development (NIFD). The MOU defines close co-operation between the two institutions on research and broadening awareness relating to FX, payments and settlement to support the healthy development of the Chinese economy and renminbi internationalisation.
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China expands CFETS Yuan basket

China expands CFETS Yuan basket

China Foreign Exchange Trade System (CFETS), the FX trading platform operator, has announced that it will adjust the way to calculate the CFETS Yuan Index, a key measure of the Yuan against a basket of currencies, from January 1st, 2017. The change is aimed at improving the mechanism generating the CFETS RMB Index, CFSCNYI and making the CFETS basket more representative
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FTSE Russell expands China offering with two new indexes

FTSE Russell expands China offering with two new indexes

FTSE Russell has confirmed the launch of two new benchmark indexes for China A-shares stocks. The FTSE China A Innovative Enterprise Indexes will provide a benchmark for the fast-growing ChiNext stocks listed on the Shenzhen Stock Exchange.
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Trump presents complex picture for RMB

Trump presents complex picture for RMB

Bloomberg News reports Guan Tao, a former deputy director of China’s State Administration of Foreign Exchange, commenting that “If Trump takes up an anti-globalization attitude, that’s a chance for the yuan to improve its global status. There’ll be opportunities for the renminbi.
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Standard Chartered approved as the first commercial issuer of SDR bonds in China

Standard Chartered approved as the first commercial issuer of SDR bonds in China

Standard Chartered Bank (Hong Kong) Limited has obtained approval from the People’s Bank of China to be the first commercial issuer of bonds denominated in Special Drawing Rights (SDRs) in China’s interbank bond market.
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HKMA designates nine CNH Primary Liquidity Providers

HKMA designates nine CNH Primary Liquidity Providers

The Hong Kong Monetary Authority (HKMA) has designated nine banks as Primary Liquidity Providers (PLPs) for offshore renminbi (RMB) market in Hong Kong
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Clearstream China Bond link now live

Clearstream China Bond link now live

Clearstream has now launched its China Bond Link to the onshore Chinese interbank bond market. This new link provides international investors with individual quota-free access to this important and growing market, leveraging market simplifications recently brought in by Chinese regulators
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Hong Kong Futures Exchange announces new RMB incentive program

Hong Kong Futures Exchange announces new RMB incentive program

The Hong Kong Futures Exchange Limited has announced a new incentive program for market participants to support the liquidity development of the RMB Currency Futures
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HKEX’s USD/CNH Futures – Product Highlights

HKEX’s USD/CNH Futures – Product Highlights

Open interest (OI) was 36,153 contracts (US$3.6 billion notional) on 28 October 2016, an all-time high, and an increase of more than 140 per cent year-on-year.
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The Redback Interview

CEINEX – Bridging Markets

CEINEX – Bridging Markets

China Europe International Exchange (CEINEX), the joint venture of Shanghai Stock Exchange (SSE), Deutsche Börse (DBAG) and China Financial Futures Exchange (CFFEX) was successfully launched in Frankfurt last year. The Redback Reporter talks with Dr. CHEN Han, Co-CEO of the exchange to learn more about the venture and the products and services it offers.
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Latest Features

Electronic platforms – a catalyst for increasing use of the renminbi

Electronic platforms – a catalyst for increasing use of the renminbi

Nicholas Pratt looks at the growing use of e-trading platforms for the trading of RMB, the reasons for the growth and the implications for the internationalisation of the currency.
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Despite yuan’s meteoric rise, dollar will dominate

Despite yuan’s meteoric rise, dollar will dominate

The international finance community is on the brink of what Cornell economist Eswar Prasad calls “a momentous event.”
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Drivers for growth in the Panda Bond market

Drivers for growth in the Panda Bond market

Dagong Global Credit Rating (Hong Kong) recently published an important report into the Panda bond market. This is the second of two extracts we have published from this report and it investigates what it would take for Panda bonds to become a global fixed-income instrument in terms of five market drivers.
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Deploying the Renminbi as a treasury management currency

Deploying the Renminbi as a treasury management currency

The RMB is now a viable international treasury management currency but as Richard Willsher discovers, its use is still not entirely free of controls.
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The developing role of the Renminbi as an international payments currency.

The developing role of the Renminbi as an international payments currency.

Driven by the size of the Chinese economy and the breadth of its trade relations with the rest of the world, the RMB has rapidly become significant in cross-border payments. By Richard Willsher
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Is China gearing up for a currency war?

The official answer is “no” to whether China is deliberately weakening its currency but the devaluation of the Renminbi (RMB) is happening anyway. By Richard Willsher
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RMB Trade Invoicing

With the value of cross-border deals settled in the redback more than doubling in 2014, it is not surprising that more multinational companies are choosing to invoice in RMB as they look to improve profit margins.
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The Renminbi's Rise to Reserve Currency

In the years prior to 2008, China had maintained a pegged exchange rate and managed its immense trade surplus simply by acquiring more dollar-denominated securities, mostly Treasury bills. This situation, famously coined the “dollar trap” by Paul Krugman, in which China was doomed to unconditional support of the USD given the capital loss that depreciation would induce, ultimately led to the country’s push for renminbi (RMB) internationalization.
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The renminbi - A long term story

The world’s oldest country is taking a long-term view of the internationalisation of its currency. Much talk about the renminbi this year has focused on its volatile start, but China is looking to the long term, far beyond these short-term fluctuations. By David Craig, President of the Financial and Risk business unit at Thomson Reuters.
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The Redback comes of age: managing risks and harnessing opportunities in offshore renminbi

The internationalisation of the Chinese renminbi has picked up pace this year, with a growing volume traded in the offshore currency. But its path to becoming a major international currency in its own right still has some way to run, writes Joel Clark
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Data, Indicators & Indices

Offshore Renminbi – Currency stability takes priority

Offshore Renminbi – Currency stability takes priority

The Standard Chartered Renminbi Globalisation Index rose to 1,953 in November from a revised 1,935 in October.
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SWIFT Tracker shows RMB remains stable

SWIFT Tracker shows RMB remains stable

In March 2016, the RMB remained stable in its position as the fifth most active currency for global payments by value with a share of 1.88%, a slight increase from 1.74% in February 2016
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Dim Sum Bonds on London Stock Exchange

Dim Sum Bonds on London Stock Exchange

There are now 73 dim sum bonds listed on the London Stock Exchange's markets with a combined volume of RMB 30.02 billion (US$4.8 Billion) from a diversified issuer base of over 20 issuers.
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Chinese business sentiment remains below 50

Chinese business sentiment remains below 50

​Confidence among executives at China’s largest companies remained stable in March, with firms evenly split on the development of business conditions over the past month, according to the latest MNI China Business Sentiment Survey.
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S&P CHINESE RENMINBI INDEX

S&P CHINESE RENMINBI INDEX

The S&P Chinese Renminbi Index is designed as a tradable index that replicates the performance of the Chinese Renminbi versus the U.S. Dollar.
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Regional Spotlights

Frankfurt-am-Main: seeking to become the primary European hub for offshore RMB

Frankfurt-am-Main: seeking to become the primary European hub for offshore RMB

Brexit, the launch of CEINEX and its status as the first RMB clearing hub in Europe are all causes for optimism in terms of Frankfurt’s ambitions to be the primary European hub for offshore RMB. Nicholas Pratt investigates further.
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Hong Kong – The premier RMB centre

Hong Kong – The premier RMB centre

Hong Kong enjoys a unique relationship with mainland China that has benefited its status as a RMB hub. Nicholas Pratt looks at how Hong Kong plans to maintain its status as the premier centre for offshore RMB use.
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Leveraging the strengths of the Lion City: Singapore stands tall as a key offshore RMB centre

Leveraging the strengths of the Lion City: Singapore stands tall as a key offshore RMB centre

Singapore has worked hard to establish its RMB hub and enjoyed significant growth in RMB activity but with China undergoing an economic transformation and rival regional hubs also growing in size and number, the hard work for Singapore may just be beginning, discovers Nicholas Pratt.
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Canada – The RMB gateway to North America

Canada – The RMB gateway to North America

A year after becoming the first renminbi centre in the Western Hemisphere, Canada remains a major player in the push to internationalise the Chinese currency. The country has positioned itself as the RMB gateway to the world’s largest economy and companies based in North and South America can now centralize renminbi payment activity in their own time zone further minimizing any exchange rate risk.
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Australia – ideally placed as a leading RMB trading and clearing hub

Australia – ideally placed as a leading RMB trading and clearing hub

​The liberalisation of China’s currency is shaping up to be one of the most important shifts in the world’s financial system of the past decade, and there are few places where the benefits and challenges will be felt more than in Sydney. By Caroline Henshaw
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London: Perfectly positioned to become a leading RMB centre

Hong Kong remains the dominant offshore renminbi centre, but there is growing competition from London, Singapore, Luxembourg, Taipei, Paris and Frankfurt. by Jon Vollemaere, R5
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Luxembourg: Offering a unique financial ecosystem

With ancient castles and historic churches standing in view of gleaming skyscrapers, Luxembourg’s skyline serves as a constant reminder of how the tiny country has evolved from a historic centre into a global financial hub. By Caroline Henshaw
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News from the hubs

National Bank of Canada issues Panda Bond

National Bank of Canada issues Panda Bond

National Bank of Canada has issued a first tranche of its Panda Bond program raising RMB3.5 billion (approximately CAD690 million) in Mainland China’s public bond market.
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Allocation of RQFII Quota to Ireland

Allocation of RQFII Quota to Ireland

The People’s Bank of China has announced a quota for Ireland of 50 billion yuan under the Renminbi Qualified Foreign Institutional Investors (RQFII) scheme.
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Fidelity is first foreign firm to sell investment products in China

Fidelity is first foreign firm to sell investment products in China

Fidelity Investment (Shanghai) Ltd has become the first wholly foreign-owned private equity fund to operate in China’s A-share market, the Asset Management Association of China said.
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Moscow Exchange signs MoUs with two Chinese firms

Moscow Exchange signs MoUs with two Chinese firms

Moscow Exchange (MOEX) has signed memorandums of understanding (MoUs) with two leading Chinese securities firms, CITIC Securities and Galaxy Securities
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Bank of China officially opens branch in Serbia

Bank of China officially opens branch in Serbia

Bank of China has opened its branch in Serbia becoming the first Chinese bank starting operations in the country.
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Yuan clearing bank designated for UAE

Yuan clearing bank designated for UAE

People’s Bank of China has announced that it has designated Agricultural Bank of China Limited, Dubai Branch, to clear yuan transactions in the United Arab Emirates
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ASX extends RMB services

ASX extends RMB services

ASX has launched a renminbi securities depository service which extends the portfolio of RMB services developed by ASX in cooperation with the Bank of China Limited, Sydney Branch
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Macau to become a RMB clearing centre

Macau to become a RMB clearing centre

Beijing has confirmed that Macau will become a key centre for yuan settlement. The confirmation came via state news agency Xinhua as Premier Li Keqiang departed Macau after a three-day landmark visit
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RMB clearing bank chosen for New York

RMB clearing bank chosen for New York

China’s central bank has designated an official renminbi clearing and settlement bank for New York City.
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Philippines adds yuan to reserves

Philippines adds yuan to reserves

The Philippine central bank has added the Chinese yuan to its official international reserves, saying that the move reflects the rising importance of the Chinese currency globally as well as increasing trade between the two countries.
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Special Report

RMB now sixth most used currency for global payments

RMB now sixth most used currency for global payments

According to SWIFT October 2016 data, the RMB was now in the top six of world payment currencies by value with a share of 1.67%.
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Expert Opinion

London is China’s route to international investors

London is China’s route to international investors

China is the world’s most populous nation and as the second largest global economy, with the second largest equity market by capital value in the world, and leadership of the G20, it is a major engine of global economic growth.
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The potential impact of Brexit on the UK’s relationship with the RMB

The potential impact of Brexit on the UK’s relationship with the RMB

The result of the recent referendum vote on whether the UK should leave the European Union has very significant ramifications which are going to take time to play out. David Pavitt, Managing Director, Head of RMB Business Development for Global Markets EMEA at HSBC examines some of the issues resulting from the Brexit decision with respect to the UK’s position as a leading RMB trading and clearing centre.
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Market Commentary

China – Stable FX reserves likely to require more forceful steps. By Louis Kuijs, Oxford Economics

China – Stable FX reserves likely to require more forceful steps. By Louis Kuijs, Oxford Economics

Since 2015, the People’s Bank of China’s policy has been to allow some deprecation versus the US$ in the face of pressures from financial capital outflows and a globally strong greenback, but to intervene to control and manage the pace of depreciation.
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Global business use of Chinese renminbi climbs by 7 percentage points

Global business use of Chinese renminbi climbs by 7 percentage points

Almost a quarter of companies are now using the renminbi (RMB) to do business with China, but few are capitalising on the Chinese government’s flagship ‘Belt and Road’ trade initiatives, a new survey from HSBC Commercial Banking shows.
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A tumultuous 18 months in China’s Financial Markets – Implications for International Corporates

A tumultuous 18 months in China’s Financial Markets – Implications for International Corporates

It has been a tumultuous 18 months for China as it seeks to rebalance its economy to a more consumption-led basis and address the key economic issue: excess leverage in the system.
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A good week for Chinese banks –Taking control of the offshore and onshore RMB markets

A good week for Chinese banks –Taking control of the offshore and onshore RMB markets

It’s been an interesting week, during which there have been two very significant developments in RMB trading.
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Provider Profiles

A Connectivity Specialist

A Connectivity Specialist

The Redback Reporter talks with James Banister, CEO, FXecosystem, a leading provider of FX connectivity services.
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ICBK – working to promote the growth of RMB business in Canada

ICBK – working to promote the growth of RMB business in Canada

Industrial and Commercial Bank of China (Canada) (“ICBK”) was designated as the RMB Clearing Bank in Toronto by the People’s Bank of China (“PBOC”) in November 2014. On March 23, 2015, ICBK officially inaugurated the Canadian RMB Clearing Bank and Trading Hub and has thus preliminarily established a sustainable world-wide “24/7” real-time RMB trading and clearing network
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FX trading on MOEX – Liquid and growing in demand

FX trading on MOEX – Liquid and growing in demand

The Redback Reporter talks to Igor Marich, Managing Director of FX and Money Markets at the Moscow Exchange.
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EBS Market

EBS Market

EBS Market, EBS BrokerTec’s flagship central limit order book electronic trading platform, supporting spot FX currencies, precious metals and non-deliverable forwards (NDFs), expanded its core currencies to include the offshore Chinese renminbi (CNH) back in 2010. Since then, EBS has built a large and diverse trading community of more than 100 institutions trading daily, and developed multiple trading order types, features and functions for CNH. Darryl Hooker, Co-Head of EBS BrokerTec Markets, outlines how the currency has taken off to become the ‘major minor’ currency it is today.
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Economic Analysis

Westpac MNI China Consumer Sentiment Indicator rebounds

Westpac MNI China Consumer Sentiment Indicator rebounds

Consumer sentiment improved in December, led by a bounce-back in consumers‘ optimism about their expected personal finances which offset a pullback in durable buying conditions.
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Follow the Analyst

RMB Outlook: Tail and Headwinds Fading

RMB Outlook: Tail and Headwinds Fading

China feels Brexit too. The Chinese Yuan (CNY) continues to weaken breaking 6.60 (Chart 1), the highs reached earlier this year post the devaluation. The risk-off environment from Brexit has strengthened the USD and weakened CNY.
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Wealth, Travel & Lifestyle

Asia-Pacific to Lead the Global Wealth Management Industry

Asia-Pacific to Lead the Global Wealth Management Industry

By Chirag Thakral and Varun Rawat, Lead Strategic Analysts, Market Intelligence, Capgemini Financial Services
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The development of Wealth Management as a profession in China

The development of Wealth Management as a profession in China

Since 2010 China has become the second largest economy in the world and listed among upper middle income countries which are characterised by an explosive growth of individual wealth. China achieved GDP per capita at US$8,000 in 2015 and the number of its HNWIs has approached that of the USA.
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China business travel market overtakes the United States

China business travel market overtakes the United States

China’s business travel market has overtaken the United States as the number one business travel market in the world. This is one of the key findings from the GBTA BTI™ Outlook – China 2016 H1, a report by the GBTA Foundation, the education and research arm of the Global Business Travel Association (GBTA), sponsored by Visa, Inc.
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The rise of Chinese HNWIs presents opportunities in the expanding wealth management industry

The rise of Chinese HNWIs presents opportunities in the expanding wealth management industry

Asia-Pacific continues to be the driving force of global high net worth individual (HNWI) population and wealth. With a number of rapidly expanding economies in the region, the wealth management industry is well-positioned to benefit from the rise in demand for managing the increasing HNWI wealth.
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Regulatory Issues

Regulatory developments in the Panda bond market

Regulatory developments in the Panda bond market

Dagong Global Credit Rating (Hong Kong) recently published an important report into the Panda bond market. This is the first of two extracts we will be publishing from this report. This article focuses on how major regulations of Panda bonds are evolving.
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Business Focus

The Chinese equipment leasing market. By Yanping Shi and Ting Yang

The Chinese equipment leasing market. By Yanping Shi and Ting Yang

​In 2015, China’s economy still suffered downturn pressure. The Central Committee and the State Council promoted the principle of making progress while maintaining stability. In this context, China’s GDP reached Rmb676,708, increasing 6.9% year-on-year, marking the lowest growth for 25 years. The macroeconomic recession caused pressure for the leasing industry from the following three aspects.
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