Meanwhile, the Chinese authority is determined to liberalize the financial market and internationalize its currency, and London has the biggest foreign exchange center. It is natural for London to become the offshore center of renminbi, he added.
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"The assumption was that Chinese currency was held artificially low for years, which makes it a very attractive currency to hold as there can only be appreciation," he said. "But I am sure it is the wish of the Chinese authority that the currency should be fully convertible. In that case the currency goes up and down, like other fully convertible currencies like pounds or Euros. So it (the fluctuation) takes away the unique attraction, but make people believe the rate is set by market, and gives an indication that market is working," he added.
London has continued its steady growth in the trade finance and foreign exchange transaction of offshore yuan business in 2013, according to the latest report authored by the Bourse Consult and commissioned by the City of London Corporation.
The research examines the development of offshore yuan markets globally, with results indicating that from January to December 2013 the yuan denominated trade financing in London grew by 10 percent compared to 2012 and totaled nearly 43 billion yuan.
Within this, export financing showed particularly strong results with a substantial increase.
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