Sectors

Renminbi revaluation will boost south-east Asia stocks

Date: 22 Jun 2010

Commodities firms, some real estate companies and banks in south-east Asia should benefit from the rise in the renminbi’s value, says Citi.

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Pamela Tang

Natural resources companies and financial institutions in south-east Asia are likely to be key beneficiaries of China’s shift in exchange rate policy, says Citi.

On June 17, the People’s Bank of China said that it would allow the renminbi to fluctuate again, after it kept the currency pegged at Rmb6.83 against the US dollar for nearly two years.

A rising renminbi is expected to boost domestic consumption and demand for commodities. Externally, Chinese corporates are likely to increase foreign investments while its citizens are expected to up tourism spending.

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