Renminbi Globalisation Index up 4.8% in June
Standard Chartered today announced that the Standard Chartered Renminbi Globalisation Index (Bloomberg: SCGRRGI <index>), or the RGI, reached 1,050 in June, up 4.8% from the previous month and up 65% year-on-year, withstanding macro and market uncertainties.
The rise was mainly driven by a rise in CNH FX turnover, offsetting a mild reduction in Renminbi-denominated cross-border payments through Hong Kong and Singapore on the back of falling Chinese exports in June.
Primary issuance of offshore Renminbi bond market in July slid to the lowest in the year as risk appetite remained weak on concerns over China’s slowing economic growth and likely stalling currency appreciation. Stabilising market condition is likely leading to re-opening of the primary market for high quality issuers.
The index remains on track to reach at least 1,200 by the end of the year, but the pace of increase in the second half is likely to ease from the first half, or at least until China emerges from its recent growth soft patch and the Renminbi resuming its appreciation trend.
Over the next month, all eyes will be on the announcement of a new policy package that would define the new Free Trade Zone initiative in Shanghai recently approved by the State Council. The plan is likely to include experimentation on freer cross-border commodity and capital flows, as well as greater Renminbi convertibility by corporates operating in the zone. Shanghai Free Trade Zone will be a positive to all CNH centres.
Standard Chartered launched the RGI in November 2012. The Index covers the top three markets in offshore RMB business: Hong Kong, London, and Singapore. It measures business growth in four key areas: deposits (denoting store of wealth), Dim Sum bonds and Certificate of Deposits (as vehicles for capital raising), trade settlement and other international payments (unit of international commerce) and foreign exchange (unit of exchange). As the Renminbi further internationalises, there is capacity to include additional parameters and markets.
Standard Chartered Renminbi Globalisation Index
| Objective | The first industry benchmark that effectively tracks the progress of RMB business activity. Offers corporates and investors a quantifiable view of the latest trends, size and levels of offshore activity that are driving RMB adoption |
| Index Parameters | Deposits Dim Sum Bonds and Certificate of Deposits Trade Settlement & Other International Payments Foreign Exchange Turnover |
| Markets | Hong Kong London Singapore |
| Investability | Non-tradable |
| Frequency | Monthly |
| Base value and date | 100 at 31 December 2010 |
| Inception Date | 14 November 2012 |
| Methodology | Weight of each of the four parameters are inversely proportional to their respective variances |
For further information, please contact:
Gabriel Kwan
Head of Corporate and Business Communications
Tel: +852 2820 3036
Email: Gabriel.Kwan@sc.com
Joyce Li
Corporate & Business Communications Manager
Tel: +852 2820 3841
Email: Joyce.Li@sc.com