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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (17027)	11/29/2004 12:17:13 AM
From: RealMuLan	Respond to of 116555

Regulatory worries over yuan contracts Tim LeeMaster The mainland's foreign-currency derivatives market is growing, but the emergence of a yuan derivatives market is still some time off as official concerns about potential instability during a critical phase of financial reform restrain banks' desire for more fee-based income. ``They're very open-minded about foreign currency derivatives but regulators are not ready to allow [yuan-denominated derivative] products to be offered in China,'' a banker who recently met with representatives of several Chinese regulatory bodies said. The foreign-currency derivatives market has made great strides as companies hedge the US dollars, euros and yen they use to trade overseas. Domestic punters can also seek higher returns from their foreign-currency holdings through services offered by local and international banks. But when domestic banks approached the China Banking Regulatory Commission recently to ask if the country's new derivatives licensing regime applied to trading in yuan instruments, the answer came back a resounding no, the banker said. thestandard.com.hk