Yuan Transactions in London Surged by Almost One-Third in Second Quarter(Yicai Global) Sept. 27 -- The average daily value of offshore yuan transactions in London increased by close to one-third annually in the second quarter, according to a joint report by the UK capital's municipal governing body and China's central bank.
Foreign exchange market transactions in London averaged around GBP70 billion (USD91.9 billion) in the quarter marking a 32.9 percent increase on the same period last year and a 13.5 percent compared with the first quarter, according to the London RMB Business Quarterly report from the City of London Corporation and People's Bank of China Europe Representative Office.
"London has long been the world's number one foreign exchange hub, clearing more dollars than New York, more Euros than anywhere in the EU, and more RMB than any country outside Greater China," said City of London Corporation Policy Chairman Catherine McGuinness. "This new quarterly report aims to help us maintain this position, providing an overview of the market for Chinese currency in the City."
The second quarter witnessed the listing in London of seven new so-called dim sum bonds which are issued outside of China but denominated in yuan. Some 102 dim sum bonds had been listed on the LSE with a total size of CNY31.1 billion (USD4.6 billion), as of the end of the quarter. The total actual cross-border yuan settlement between China and the UK increased by almost one-and-a-half times to CNY176.2 billion from last year.
The quarterly report aims to make the market participants more aware of the offshore yuan market in London and further promote the redback's internationalization. It covers London's yuan foreign exchange, bond, credit and cross-border settlement markets.
The yuan ranked as the fifth most-used currency for trade settlements globally in July according to data from the Society for Worldwide Interbank Financial Telecommunications. London represents the second0biggest offshore yuan clearing center second only to Hong Kong with a daily average clearing volume of over CNY40 billion.
Editor: William Clegg
