·Korea and Singapore’s RQFII quota increases occurred for different reasons
·Global RQFII hubs are fulfilling different roles and niches
·Hong Kong’s RQFII cap is not detrimental to its role as the key RMB hub

Update: The RQFII program continues to fire with Korea and Singapore both receiving aggregate quota top-ups in November. Both increases occurred within a short timeframe as a result of high allocation rates (63% for Singapore and 71% for Korea), but RQFII is developing differently across global hubs. Other centers will follow different paths to utilization; London will increasingly be a key example as the core of ex-Asia RMB traffic. Hong Kong remains the elephant in the room: it is the world’s primary RMB hub with no quota left to spare. Nevertheless, Z-Ben Advisors believes it may be the test bed for the next stage of the RQFII program. RQFII quota now stands at USD166bn (RMB1.06tr) versus QFII’s USD150bn: RMB-denominated access is the new norm for investment into mainland markets.

This new norm is best reflected in Korea and Singapore, which received quota top-ups of RMB40bn and RMB50bn (increases of 50% and 100%) respectively. Both have embraced RQFII, but in different ways. Korea has enjoyed the fastest quota allocation rate of all ex-HK RMB hubs: this was solely driven by…..

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