RMB round-up: USDCNH futures have strong day, HK RMB deposits up in April, China and Germany co-operate on trade and finance

In this week’s round-up, the Hong Kong Exchange’s USDCNH futures record their second best trading volume on Wednesday, renminbi deposits in Hong Kong increase by 4.1% in April, and China and Germany agree to co-operate on trade and finance.

  • By Noah Sin
  • 02 Jun 2017
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FX:


  • PBoC’s renminbi fix against the dollar was set at 6.8070 this morning, stronger by 20bp from Thursday. In the spot market, the CNY was trading at 6.8150 as of 11.35am, with the CNH at 6.7920, down 0.1% and 0.62% from their previous close, respectively, according to Bloomberg data.
  • The dollar index was trading at 97.222 as of 11.20am, up 0.02% from the previous close, according to Bloomberg. The Thomson Reuters CNY reference index closed at 94.17 on Friday, down 0.06% from its previous close.
  • The trade-weighted index by CFETS closed at 92.39 on May 31, which marked a monthly fall of 0.42%, with the BIS basket and special drawing rights basket at 93.32 and 93.72, down 0.43% and 0.52% in the same period, respectively, according to data released by CFETS.


Regulators:

Derivatives:

  • HKEX’s USDCNH futures trading volume reached 8,837 contracts on May 31, its second best volume ever, according to a spokesperson. The product recorded a volume of 8,658 contracts the following day, the third best volume since its launch.
  • Dubai Gold and Commodities Exchange’s renminbi-denominated Shanghai gold futures traded 2,889 contracts in May, worth Rmb805m, according to figures released by the exchange.

RMB deposits:

Trade:

  • China and Germany have signed a series of co-operation documents on trade and finance, according to the State Council. The signing took place during Chinese premier Li Keqiang’s visit to Germany on June 1, where Li also met with his counterpart, Angela Merkel. The pair agreed to speed up the process for an investment agreement between China and the European Union, according to Xinhua.
  • European companies in China are sceptical about the pace of economic reform, according to a survey by the European Chamber of Commerce and consultant Roland Berger. Published on May 31, the survey noted that only 15% of respondents expect less regulatory barriers in China over the next five years, while 40% believe that they will increase.

Equities:

  • Robeco launched its Chinese A-share fund on June 1. The fund will select stocks on the Shanghai and Shenzhen A-share markets, use MSCI China A International as its reference index, and give European investors direct access to the Chinese capital markets, said the asset manager.

Indices:


  • FTSE Russell published its quarterly review for the FTSE China Index Series on May 31. The index provider has added BOE Technology Group, Jiangsu Hengrui Medicine and Baoshan Iron & Steel to its China A50 Index. It has also added China Evergrande Group to the FTSE China 50 Index, and removed Shanghai Electric Group. 
  • Stoxx, the operator of Deutsche Börse Group's index business, has opened an office in Hong Kong to promote its presence in Asia Pacific. Speaking to GlobalRMB, Matteo Andreetto, CEO at Stoxx,said that the new office will help it tap into a new market segment.
  • “The opening of the new office will help with educating the market on what type of tools are available,” said Andreetto. “What we are seeing is a shift from active to passive [strategies] in the region […] institutional investors already have the access [to such strategies], we believe other retail and private banks will require similar strategies.”


Belt and Road:


  • China is planning to establish a fund to support green development as part of the Belt and Road, according to the Ministry of Environmental Protection. The fund will support environmental infrastructure and green industry development in OBOR countries.
  • Industrial and Commercial Bank of China is planning to set up a branch in Prague, Czech Republic. In a May 31 announcement, the bank said it received approval from local regulators in April, and that the new branch will offer deposit and settlement services, and help serve the needs of One Belt One Road financing.
  • “The opening of ICBC Prague branch will not only boost the co-operation under the Belt and Road framework between China and in Central Eastern European countries, but also provide opportunities for China’s businesses going global,” said ICBC.


Stock Exchange:

  • By Noah Sin
  • 02 Jun 2017

GlobalRMB Panda Bonds league table

Rank Arranger Share % by Volume
1 China Merchants Securities Co 21.76
2 Agricultural Bank of China (ABC) 15.11
2 CITIC Securities 15.11
4 China CITIC Bank Corp 13.60
5 Industrial and Commercial Bank of China (ICBC) 10.58

Panda Bond Database

Pricing Date Issuer Country Size Rmb (m)
1 09-May-18 Daimler Germany 5,000
2 26-Apr-18 Global Logistic Properties via Iowa China Offshore Holdings Hong Kong 1,500
3 26-Apr-18 Trafigura Singapore 500
4 23-Apr-18 CAR Inc Hong Kong 730
5 11-Apr-18 China Jinmao Holdings China 3,000

Offshore RMB Bond Top Bookrunners

Rank Bookrunner Share % by Volume
1 Standard Chartered Bank 35.60
2 HSBC 15.23
3 Bank of Taiwan 4.86
3 Cathay United Bank 4.86
5 Societe Generale Securities Services 4.21

Latest Offshore RMB Bonds

Pricing Date Issuer Country Size Rmb (m)
1 16-May-18 First Abu Dhabi Bank PJSC United Arab Emirates 1,100
2 04-May-18 Busan Bank South Korea 500
3 27-Apr-18 Central American Bank for Economic Integration (CABEI) Honduras 2,000
4 24-Apr-18 CAR Inc China 350
5 19-Apr-18 Shui On Development (Holdco for Shui On Land) China 600