Starting this week, shares of companies listed on the Hong Kong stock exchange will be listed in yuan, which will provide additional support for this currency, according to Business Insider.
About 20 stocks, including big companies such as Alibaba and Tencent, will now be available for trading in two currencies - yuan and Hong Kong dollars. In parallel, China is seeking to counter the dominance of the US dollar on a global level and is promoting its own currency.
Through the Dual Counter Model program, the Hong Kong Stock Exchange and Clearing House (HKEX) is attracting foreign investors with RMB holdings, including Russian investors as well as local investors. HKEX will also implement a program that will help minimize the difference in price between the two currencies, providing comfort to investors who can now trade Hong Kong dollars or yuan, thereby reducing conversion and hedging costs.
The yuan is currently at its lowest level against the US dollar since last November due to the slow economic recovery from the COVID-19 pandemic. In fact, the yuan is trading at its lowest level since 2014.