Geographic Spread of Currency Trading: The Renminbi and Other Emerging Market Currencies

Cheung, Yin‐Wong; McCauley, Robert N.; Shu, Chang

doi:10.1111/cwe.12292

Cited by 19 publications

(27 citation statements)

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“…The third category comprises variables that represent the economic attributes of the economy in which the financial centre is located. We follow Cheung and Yiu (2017) and Cheung et al (2019) and consider the real GDP growth rate, the equity market capitalisation normalised by GDP, the size of the international bond market normalised by GDP, and the stage of financial development. In essence, these variables are meant to capture the economic strength and the financial sector status of an offshore financial centre.…”

Section: Empirical Results IImentioning

confidence: 99%

“…The three variables Zi,16,  Xi,19, and Wi,16 are the three proxies for FX market information used by Cheung et al (2019) to examine the RMB share convergence behaviour. .9867 for the British pound, and 0.9188 and 0.9279 for the Japanese yen.…”

Section: The Basic Specificationmentioning

confidence: 99%

“…For instance, will offshore trading converge to a geographical pattern similar to the established global currencies or global FX trading? Cheung et al (2019) posit that "a currency undergoing internationalization experiences a characteristic evolution of its geographical distribution of trading outside its home jurisdiction." In the case of the RMB, its offshore trading pattern will transit from an initial regional one over time towards the global FX trading pattern.…”

mentioning

confidence: 99%

“…Against this backdrop, we study the evolution in the offshore RMB trading pattern between 2016 and 2019, and assess the determinants of the geographical diffusion process. Cheung et al (2019) assess their geographical distribution hypothesis with three variables that describe the FX turnover initial conditions, gaps between initial shares of RMB and total FX trading volumes, and changes in the share of total FX trading. Given the changing international environment in the last few years, we postulate that the offshore RMB trading pattern is affected by policy-related factors in addition to these three FX market variables.…”

mentioning

confidence: 99%

“…While the changing environment has not stalled the RMB internationalization process, it can affect the geographical diffusion process of offshoring trading. Cheung et al (2019), motivated by the striking similarity of the global trading patterns of the dollar and the yen, hypothesizes that the geography of offshore RMB trading will over time transit towards the geographical distribution of global FX trading.…”

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confidence: 99%

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The evolution of offshore renminbi trading: 2016 to 2019

Cheung

Grimm

Westermann

2021

Journal of International Money and Finance

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We study the evolution of offshore renminbi trading between 2016 and 2019. The diffusion behaviour of offshore renminbi trading during this period is different from the one between 2013 and 2016. The geographical diffusion process displayed in the 2016-2019 period, in addition to the previously reported convergence to the geographical trading pattern of all currencies, is affected by trade intensity, bilateral swap line arrangements, and has a regional bias. Further, it is possibly affected by disputes with China, and is different from the diffusion behaviours of the offshore US dollar, euro, British pound, and Japanese yen trading.

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Section: Empirical Results IImentioning

confidence: 99%

Section: The Basic Specificationmentioning

confidence: 99%

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confidence: 99%

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confidence: 99%

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confidence: 99%

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The evolution of offshore renminbi trading: 2016 to 2019

Cheung

Grimm

Westermann

2021

Journal of International Money and Finance

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Transition and Triad

Guttmann

2021

Multi-Polar Capitalism

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Transition and TriadA year into the global pandemic successful vaccination campaigns, first in Israel followed by the United Kingdom and the United States, have shown that the virus can be contained effectively once 75 percent or more of the adult population has been fully vaccinated. Even though global access to the vaccines has so far left much to be desired, amidst a still inadequate effort at worldwide cooperation and coordination, the end of the pandemic is in sight. As more and more places are reopening, economic activity can resume. Despite considerable damage to jobs and businesses, economies have proven remarkably resilient in their ability to bounce back. Recoveries have by and large been quite strong, better for the most part than predicted earlier when the pandemic still raged. Such encouraging signs of revival are certainly the result of extraordinary levels of both fiscal and monetary stimulation providing a strong impetus for pent-up demand and reorganized supply capacity to interact productively. We thus have a chance to shake off the global deflation context to which much of the world economy had been subjected since the Great Financial Crisis of 2007/08. The pandemic will also have left us with new political openings, crucial policy shifts, and profound structural change.All this points to the potential for the launch of yet another long wave and the emergence of a new accumulation regime driving the latter's upswing phase. It is still too early to know whether this is indeed possible. Will the post-pandemic recovery be sufficiently strong

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