Hong Kong authorities could soon relax the renminbi daily exchange limit of 20,000 yuan (US$3,268) for local individuals as the city gears up for the launch of a cross-border stock trading program, the Hong Kong Economic Journal reported.
Sources told the paper that the Hong Kong Monetary Authority could unveil the details this week ahead of the launch of the Shanghai-Hong Kong Stock Connect program on Nov. 17.
“The Hong Kong Monetary Authority is following up with the People’s Bank of China, with a view to finalizing the measures as soon as possible,” a spokesperson with the city’s de facto central bank said in response to queries about the relaxation of the daily currency conversion cap for local individuals.
The HKMA needs to give some time for banks to prepare their systems for the change, a person said.
Authorites had earlier this year lifted the daily exchange cap for non-residents.
DBS Bank (Hong Kong) chief executive Sebastian Paredes believes a removal of the daily exchange limit will ease the hassles for individual investors who seek to park money in renminbi-denominated financial products.
The onshore exchange rate of the Chinese currency rebounded 200 basis points to its highest level in seven and a half months on Monday before closing at 6.1196 to the US dollar.
Tommy Ong, executive director, treasury and markets, at DBS Bank expects the redback to appreciate another one percent by the end of this year.
– Contact us at [email protected]