The internationalisation of the RMB: New starts, jumps and tipping points

Jonathan A Batten; Peter G Szilagyi

doi:10.1016/j.ememar.2016.02.006

The internationalisation of the RMB: New starts, jumps and tipping points

Jonathan A Batten, Peter G Szilagyi

Banking & Finance

Research output: Contribution to journal › Article › Research › peer-review

19 Citations (Scopus)

Abstract

We investigate the process of currency internationalisation of the Chinese Renminbi (RMB). Aggregated cross-border data provided by the Society for Worldwide Interbank Financial Telecommunications (SWIFT) allows better measurement of the role played by a currency in trade and settlement. RMB transactions are significant and increasing but remain concentrated in key financial centres. Analysis using an asset pricing framework shows that the footprint of Chinese corporations in international markets has at times been significant, with the size of these transactions prompting many to reassess the likely pace of RMB internationalisation and its usage as an alternate vehicle currency.

Original language	English
Pages (from-to)	221-238
Number of pages	18
Journal	Emerging Markets Review
Volume	28
DOIs	https://doi.org/10.1016/j.ememar.2016.02.006
Publication status	Published - 1 Sept 2016

Keywords

Currency Internationalisation
Financial market development
Renminbi
RMB
Society for Worldwide Interbank Financial Telecommunications (SWIFT)

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10.1016/j.ememar.2016.02.006

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AB - We investigate the process of currency internationalisation of the Chinese Renminbi (RMB). Aggregated cross-border data provided by the Society for Worldwide Interbank Financial Telecommunications (SWIFT) allows better measurement of the role played by a currency in trade and settlement. RMB transactions are significant and increasing but remain concentrated in key financial centres. Analysis using an asset pricing framework shows that the footprint of Chinese corporations in international markets has at times been significant, with the size of these transactions prompting many to reassess the likely pace of RMB internationalisation and its usage as an alternate vehicle currency.

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KW - Financial market development

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The internationalisation of the RMB: New starts, jumps and tipping points

Abstract

Keywords

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