HSBC reveals yuan bond issue to boost London as 'hub'

By Yiannis Mostrous: Most people think of dim sum as the Chinese tea time meal that consists of dumplings and other snacks served by waiters pushing steam carts around the dim sum parlor. But for global investors, the term “dim sum” also refers to the offshore Renminbi (RMB) bond market. The currency in which these bonds are denominated is also referred to as Chinese Offshore Yuan (CNH). This fast growing market was established in 2007, but didn’t take off until last year.

Carnegie Endowment submits:China is successfully promoting the use of its currency, the renminbi (RMB), for international trade and investment. Economic logic suggests that this will eventually require full convertibility—the ability to change the RMB into another currency for any purpose and in any amount, without restriction. RMB reserve currency status1 will also require China to establish an open capital account and deeper and more competitive capital markets.

Once again we are seeing articles and research papers stating the Chinese renmimbi (yuan) is about to replace the dollar as the global reserve currency. Here is a working paper by Arvind Subramanian and Martin Kessler at the Peterson Institute of International Economics stating The Renminbi Bloc is Here: Asia Down, Rest of the World to Go?.

Deutsche Bank says it has completed the first cross-border Renminbi (RMB) payment under the People’s Bank of China (PBOC) Shanghai’s Simplified RMB Cross-Border Payment Pilot Scheme. The bank executed a trade payment denominated in RMB for the Chinese subsidiary of Huettenes-Albertus, the German chemicals manufacturer. According to Deutsche Bank, the scheme significantly streamlines the process [...]

By Tom Lydon: Invesco PowerShares unveiled its new ETF offering that will provide investors access to the yuan-denominated debt market.

By ETF Database: Guggenheim has apparently won the race to launch the first U.S.-listed ETF offering pure play exposure to the Chinese bond market, debuting its China Yuan Bond Fund (RMB) on Thursday. The new ETF, which launches as a handful of other issuers have already laid the groundwork for similar products, will seek to replicate the AlphaShares China Yuan Bond Index.

The World Bank has issued its first yuan-denominated bond in a move that will help China as it tries to increase the use of its currency in global markets.The Washington-based lender said Tuesday it would raise 500 million yuan (76 million dollars) from the two-year bond issue on Hong Kong's yuan-denominated bond market.The move will "further deepen the market and permit investors to diversify their currency holdings and expand renminbi exposure", the World Bank said in a statement, using the official name for the Chinese unit.