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China Daily Website

Renminbi moves into the top 10

Updated: 2013-09-06 12:10
By Amy He in New York ( China Daily)

"As the currency continues to be more widely used for trade settlement, investment flows and reserve management, the volumes for RMB will continue to grow. We see regular evidence of this in our discussions with corporate and institutional clients globally," said Apratim Chakravarty, head of Asian product distribution of HSBC in New York City. "We are still some distance away from this trend peaking."

Chakravarty predicted that in the next two to three years, about one-third of China's trade will be settled in the renminbi, up from the 16 prcent in the first half of 2013, according to data gathered by the People's Bank of China and HSBC.

The renminbi's strength is coming at a time when investors are responding to the currency's appreciation.

"When people think there's going to be strong appreciation of the renminbi, they're eager to get a hold of the currency," says Nicholas Borst, research associate at the Peterson Institute of International Economics. "The primary driver is taking advantage of the currency appreciation."

In a separate report mirroring a similar trend for the renminbi, Western Union, a global payment service, reported a growing renminbi demand with its client transactions. In the US alone, renminbi transactions accounted for almost 12 percent of all payments to China in the first half of 2013, Western Union said Wednesday.

"Businesses around the world are becoming more aware of RMB internationalization and the benefits that trading in the local Chinese currency can create for all parties," said Raj Agrawal, president of Western Union Business Solutions.


(China Daily USA 09/06/2013 page10)

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