Bloomberg News

Hong Kong Yuan Deposits Climb to Within 0.5 Percent of Record

February 28, 2013

Yuan deposits in Hong Kong climbed in January to within 0.5 percent of a record as investors revived bets on the currency’s appreciation as the outlook for growth in Asia’s largest economy improved.

Savings rose 21 billion yuan ($3.3 billion) from the previous month to 624 billion yuan, the Hong Kong Monetary Authority said in a statement on its website today. That’s close to the record 627.3 billion reached at the end of November 2011. December’s 32 billion yuan jump in the savings was the biggest since August 2011.

“We are very positive on the renminbi’s long-term prospects versus the dollar,” Chen Xiaoping, chief executive officer at China Everbright International Ltd. (257), said at a media briefing in Hong Kong today. “Our sales income will be in renminbi and we are very comfortable to pay back debt in that currency.” The yuan is a denomination of the Renminbi, which is the official name of China’s currency.

Hong Kong handled 268 billion yuan of trade settled in the Chinese currency in January, a 1.7 percent increase from December, according to HKMA data.

The yuan advanced to a four-week high in Shanghai, as the People’s Bank of China set the currency’s fixing at the strongest level in more than a month. It rose 0.1 percent today to close at 6.2213 per dollar. An official report tomorrow may show China’s manufacturing growth accelerated.

The currency will appreciate 2.1 percent to 6.1 per dollar by the end of 2013, doubling the pace of 1 percent increase last year, according to the median estimate in a Bloomberg survey of economists.

To contact the reporter on this story: Fion Li in Hong Kong at fli59@bloomberg.net

To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net


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