China’s economy grew at an annual rate of 6.7 percent in the first quarter of 2016 – the lowest level since the depths of the financial crisis. Slowdown in China, for years a key engine of global growth, has spooked international investors and prompted Beijing to unleash heavy stimulus, including increased fiscal spending on infrastructure and looser monetary policy.
However, the Chinese government has been pushing forward with market-oriented foreign exchange (FX) reform, as well as taking significant steps to internationalise its currency and open up its capital markets to global investors. In December, the IMF decided to include the renminbi in its Special Drawing Rights (SDR) basket, given the steps China has taken to make its currency freely usable. Renminbi trading activity has mushroomed in recent years, thanks to reforms that have relaxed investment restrictions for foreign investors, the growing availability of a wide range of investment and hedging products, and the increasing liquidity of offshore renminbi markets.
The FT-ANZ RMB Growth Strategy Series will gather senior representatives from business and finance to share their views on China’s economic rebalancing, as well as the implications of its ongoing currency internationalisation, exchange rate reform, and capital markets liberalisation programme.