Visitors pass a sign inside the London Stock Exchange headquarters. The  LSE yesterday launched a product allowing small investors exposure to Chinese bond markets in the local currency, building on the British capital’s status as a global financial hub.

AFP/London


The London Stock Exchange (LSE) yesterday launched a product allowing small investors exposure to Chinese bond markets in the local currency, building on the British capital’s status as a global financial hub.
“The listing, the first of its type in any European market, underlines London and London Stock Exchange’s pre-eminent position as the leading Western financial centre for trading of” products denominated in renminbi (RMB), said a statement issued by the LSE.
The new Exchange Traded Fund (ETF) is the first to offer both institutional and retail investors exposure to money market instruments that invest in the China Interbank Bond Market (CIBM) via Germany’s Commerzbank and China’s CCB International (CCBI).
“This is a landmark listing for London and an important sign of the market’s openness to new RMB product development,” said LSE chief executive Xavier Rolet in a statement.
“We are fully committed to supporting the efforts of the Chinese and the UK governments in developing an offshore RMB market in London through innovation and partnership.” Jin Xu, a senior official at the Chinese embassy in London said “the UK can continually play an important role in the RMB internationalisation”.
The fund, known as Commerzbank CCBI RQFII Money Market UCITS ETF, allows investors to make use of ETFs, which are traded like shares and are widely regarded as an inexpensive and low-risk way of investing. “The launch of this innovative new product, which will provide further opportunities for British and other global investors to invest directly into China, underscores Britain’s position as the Western centre for offshore RMB and a global centre for asset management,” said senior Treasury official Andrea Leadsom.
Britain last year launched a yuan-denominated sovereign bond, the first of its kind by a Western nation outside China and the largest ever non-Chinese issue.
British politicians have been scrambling to make London China’s Western financial hub as Beijing loosens its tight regulations on international trading in the renminbi, also referred to as the yuan.