![]() “Mainland investors, including mutual fund companies like us, have genuine incentives to trade Hong Kong stocks in yuan,” said Ding. But they expect demand to pick up over time. ![]() Most of the first batch of stocks eligible for yuan trading – which include AIA Group, Sun Hung Kai Properties and Hang Seng Bank – are not listed in China.įund managers expect a lukewarm interest in the yuan counters initially, given near-term risks including a weakening yuan and wobbly stocks as China’s economy struggles. ![]() Market makers will provide liquidity and minimise price discrepancies. Under the dual counter arrangement, investors can choose to trade a stock either using Hong Kong dollars via the HKD counter, or yuan via the RMB counter. “China is pushing yuan internationalisation to avert geopolitical risks and reduce reliance on the dollar, and for that purpose, you need wider use of the Chinese currency,” said Ding Wenjie, strategist of Global Capital Investment at China Asset Management Co (ChinaAMC).ĭing said the scheme is a major milestone and expects the model to be expanded in future, beyond stocks to bonds and even alternative assets, boosting overseas asset pools denominated in yuan. Offshore yuan deposits in Hong Kong alone are estimated at some 833 billion yuan ($117 billion).Īlso on AF: Global Economy Showing Signs of De-Dollarisation, Says JPMorganįund managers say the step reflects Beijing’s desire to expand the use of yuan outside China and provide another avenue for yuan-denominated investment, thus reducing the risk of capital outflows chasing higher yielding currencies such as the US dollar. The scheme will target overseas investors with yuan holdings initially, but will later include mainland investors via the Hong Kong-China Stock Connect link-up. Starting Monday, shares of Alibaba and Tencent will be among 24 stocks which will be priced and traded in both the yuan and the Hong Kong dollar under the Dual Counter Model on the Hong Kong stock exchange (HKEX). In its latest move to duck the dollar and push towards the internationalisation of the yuan, China is set to price several Hong Kong-listed stocks of its companies in its home currency.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |