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Forex Flash: Mainland Chinese markets today in focus - BBH

FXstreet.com (Barcelona) - Brown Brothers Harriman note that there were two noteworthy articles about potential inflows into mainland Chinese markets today.

Firstly, they note that Australia's central bank plans to invest up to 5% of its foreign currency reserves in Chinese government bonds and the RBA’s total FX reserves stand at A$38.2 bln. Similarly, they add that one of China’s largest insurance companies, Ping An, said it is planning to bring billions of yuan from Hong Kong to invest into mainland capital markets, using RQFII. They write. “Both are in line with our view that inflows will continue, despite concerns about economic growth. We remain of the view that the government is bent on supporting local capital markets, and supporting inflows is one way to do it. However, this type of news is unlikely to be a big factor driving the CNY, in our view. CNY is still more of a political decision.”

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