HK Bourse Plans Yuan Liquidity Pool

Hong Kong Exchanges & Clearing is in discussions with BOC Hong Kong to create a liquidity pool for the yuan in the city, The Wall Street Journal reports, citing Oriental Daily. The liquidity pool will allow investors without yuan holdings to purchase yuan-denominated stocks.

Investors can acquire yuan stocks using Hong Kong dollars, which the clearing bank will convert into the Chinese currency. When investors choose to exit from the stock investments, they will be paid in Hong Kong dollars the yuan-value equivalent of the stock holdings.

Click here for the story from The Wall Street Journal.