(China Alert) Inbound channels hit by RMB internationalization pains
- inbound channels
-Dwindling offshore RMB pools are increasing financing costs for inbound access channels.
-The RMB’s drive towards internationalization is being hampered as a result.
Update: Liquidity squeezes in the offshore RMB (CNH) market are becoming a greater concern for global asset managers. Greater funding costs (we’ve all seen the CNH-HIBOR spikes) and shrinking CNH pools in Hong Kong are putting pressure on certain cross-border channels, in some cases discouraging demand. This raises considerations for service providers offering inbound investment support and also places an obstacle in the path of RMB internationalization. Z-Ben Advisors believes both global managers and policymakers need to reassess their approach to CNH volatility in order to maintain and service future inbound China investments.
Understanding how to reassess an inbound investment strategy is becoming a key consideration for global asset managers. We believe the cross-border investment program most likely to suffer is…
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