Growing popularity of renminbi heralds more structured products linked to the currency

The renminbi has been exciting investors since its restricted entrance into the foreign exchange market in 2005, and dramatic trade inflows since the start of this year are being reflected in greater interest in structured products based on the currency

It is no surprise that the Chinese economy is being scrutinised across the globe – and the fact that its largely non-deliverable currency the renminbi is being carefully managed by the government to remain within strict margins has not dampened investor appetite. Indeed, with HSBC estimating that 30% of Hong Kong’s total deposits will be in renminbi by 2015, banks are finding significant investor demand for structured products based on the currency. These can be used to hedge renminbi risk, as