商务英语短文阅读2.doc

Investors shaken as renminbi’s reputation as ‘one-way bet’ sours Last week the renminbi did something it has not done for years – it shocked the market. During the final three trading sessions of the week, the Chinese currency dropped as much as 1.3 per cent against the US dollar, marking its biggest three-day fall since 2011. The renminbi is now 0.6 per cent weaker against the dollar than it was at the start of the year. While the percentage decline may appear small compared with some of the recent double-digit swings in other emerging market currencies such as the Argentine peso or Kazakh tenge, a move of such magnitude in the renminbi is highly unusual. It could also spell trouble for investors. After years of ultra-low volatility thanks to the managed peg against the dollar, the renminbi has often been the subject of large, highly-leveraged positions for investors viewing it as an effective one-way bet. ANZ’s Patrick Perret-Green said the sell-off had left some speculative investors with a “very bloody nose”. Mitul Kotecha, FX strategist at Crédit Agricole CIB, said that last week’s move could be a signal of a shift in Chinese currency policy. “The market was extremely long, and we’ve seen a big shakeout of these positions”, said Mr Kotecha. “They want to try and at least provoke more risk and more uncertainty in taking this trade. They are going to keep engineering volatility until that becomes the case.” The sharp move follows a period during which the offshore renminbi rate has been trading at an increasing premium to the onshore rate. That split – a permanent feature of the market – is something made possible by China’s strict controls on its capital account. Global investors usually take bets on the currency through its Hong Kong iteration, known by the shorthand CNH. Within China, companies and investors use the official onshore rate, or CNY. Early last week, the CNH rate had reached its biggest spread over the CNY rate since 2010, suggesting that internat