China FX option reform to improve corporate risk management
Onshore corporates now able to conduct a significantly broader range of risk management approaches following relaxation of the rules around option use
The relaxation of regulations to allow Chinese corporates to sell foreign exchange options will lead to better risk management and is part of a wider liberalisation in the onshore options market as regulators move to introduce more hedging alternatives in the face of a more volatile renminbi, say dealers.
The yuan has depreciated by 2% against the US dollar this year and briefly touched 6.25 to the dollar in May. USD/CNY is currently trading at 6.17 as of August 6, following several years of
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