A Russian bank will issue “dim sum” bonds, renminbi bonds issued from another country. McDonald's and Caterpillar have issued similar bonds in Hong Kong earlier this year. The convertibility of the Chinese currency is happening faster than most expected. Traders are preparing for more active renminbi markets. These developments will change the complexion of Asian currency trading. No single or combination of countries are as big as China hence it should be a dominant currency. Much of the Chinese trade flow moves through Asia so it will be normal for companies to make payment in renminbi and issue debt which can be paid through cash flow generated from trade.
The development of this currency market may be the most important story for the new year. This is not bout the decent of the dollar but the rise of a world trading powerhouse that has capital to move around the world.
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