FX

The State Administration of Foreign Exchange (Safe) has followed up on a promise made at the end of last year, announcing on Monday that foreign institutional investors are now allowed to enter the onshore FX derivatives market.

China is understood to have tweaked its renminbi fixing mechanism by reducing the reference window of the baskets of currencies it tracks.

ICBC (Asia) has begun offering 24-hour CNH prices for its clients, become the first Chinese bank to quote offshore renminbi all day.

While all eyes are focused on the Brexit process, the Bank of England (BoE) has quietly begun publishing numbers that support London's claim to be the leading RMB hubs in Europe. Meanwhile, market participants continue debate the relevance of the upcoming China-London Connect scheme.

After taking a beating in 2016, many are expecting the renminbi to fall further against the dollar this year. But few market watchers expect another sharp depreciation, with some believing the RMB may have already reached the bottom.

Donald Trump could end up being China’s best friend following his comments this week that the dollar is too strong. If the US president elect decides to engineer a weaker dollar, it would help solve China’s most imminent issue — capital outflows.

Hong Kong Exchanges and Clearing (HKEX) plans to introduce options on the Chinese renminbi currency, as well as a US dollar/offshore renminbi contract, having gained approval from the Securities and Futures Commission of Hong Kong.

The shock victory of Donald Trump in the US presidential elections on November 9 is already having an impact on the RMB, with the currency weakening to new record lows. We gathered some of the key views from top bank analysts in the days since which draw a picture that is far from pretty (but not hopeless) for China.

In a rollercoaster day for markets, the renminbi had a rocky start before gaining ground against the dollar as news on the US elections unfolded. But volatility is likely to continue in the coming days as markets get to grips with Donald Trump’s victory.

There has been plenty of market attention this week on the movement of the onshore renminbi with China resuming normal service following the end of the Golden Week holidays. While the CNY did break through the psychological Rmb6.7 barrier against the US dollar, more volatility is expected thanks to a strengthening greenback.

Hong Kong Exchange, through its subsidiary OTC Clear, has launched a clearing service for cross-currency swaps, beginning with the dollar/offshore renminbi currency pair.

It has been one year since China shocked the world with a new methodology for generating its official daily USD/CNY fix that caused a sharp fall in the currency. Market participants told GlobalRMB that the new regime has been a step up from the old system, but while more near-term reforms are unlikely, they are bracing for even more volatility.