Dim Sum market open despite FX slump

摘要

The offshore renminbi bond market stayed open last week as buyers shrugged off an unexpected plunge in the renminbi and a shift in swap rates opened up an arbitrage opportunity for investors. The currency dropped almost 1.3% between February 19 and 26, its sharpest weekly move against the US dollar since September 2011. While that forced investors to reassess their expectations of near-certain currency appreciation, four issuers priced Dim Sum public bonds last week to raise a combined Rmb6bn (US$984m). The issues confirm that currency speculators no longer hold sway over the Dim Sum debt market, but that it is developing into a broad-based credit market, where investors are more focused on interest rates and relative values.