The falling cost of swapping offshore renminbi, or CNH, bonds into other currencies has prompted foreign issuers to seek funding in the still-nascent market since the beginning of the year.
China’s recent easing of monetary policy, relaxation in rules governing cross-border currency flows and lack of Chinese borrowers issuance in the offshore market have caused cross-currency swap rates between the dollar and CNH to hit an all-time high in recent weeks.
These factors have made it more attractive for overseas borrowers looking to broaden their funding options into the so-called dim sum bond market as they are able to save approximately 39 basis points to 49bp...
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