FX:
The dollar fix by PBoC came in slightly stronger at 6.8988 on Monday, up by 135bp. Meanwhile, the spot market saw a stronger opening by the onshore RMB (CNY), trading at 6.9062, up by 0.1% from the previously session as of 11.25am, according to Wind data. The offshore RMB (CNH) was trading at 6.8911, up by 0.05%.
The Marc 13 CNH Hibor by the Hong Kong Treasury Market Association came in at 3.00%, down from 3.16% on Friday.
The dollar index was trading slightly weaker at 101.24, down 0.1% from previous close. The Thomson Reuters CNY reference index closed at 94.93 on March 12, down 0.14 from March 10. The trade-weighted index by CFETS closed at 94.23 on March 10, down 0.05% from March 3. Meanwhile, the BIS basket and the special drawing rights basket stood at 95.52 and 95.67, down from 95.62 and 96.11, respectively.
Regulators:
On March 10, PBoC governor Zhou Xiaochuan said the Chinese bond market will continue to open up, but not seek to be included in certain indices. Zhou’s comment followed the Citi and Bloomberg’s inclusion of China in their indices in the past two weeks. Deputy Pan Gongsheng added that the next step for bond market opening up will be institutional changes in the law, accounting, auditing, tax and crediting rating, with the goal of creating a more convenient and benign environment for foreign investors. Zhou and Pan made the remarks at a press conference on the sideline of the Two Sessions annual conference, which will close later today.
CSRC chair Liu Shiyu said the regulator would consider a Bond Connect scheme between Hong Kong and mainland China, according to local media reports on March 10. Liu added that time is required for implementation due to the differences in regulations between the two markets. Liu’s comment came after a meeting with representatives from one of Hong Kong’s political parties, who suggested an expansion of cross-border connections following the launch of Shenzhen and Shanghai Hong Kong Stock Connect.
Stock Connect:
On March 10, CSRC said it has exposed the first cross-border market manipulation case under the Shanghai-Hong Kong Stock connect, confiscating over Rmb1.2bn ($174m). In a statement, CSRC accused two perpetrators from Shenzhen of manipulating shares of Zhejiang China Commodities City Group.
Hubs:
The Hong Kong Government has appointed Stephen Yiu Kin-wah to the board of the Hong Kong Exchanges and Clearing (HKEX). Yiu was the chairman and CEO of KPMG China and continues to serve as a non-executive director at the Insurance Authority.