Yuan slump turns Hong Kong into haven as mainland Chinese rush for higher bank rates, insurance policies and US dollar
- The yuan has depreciated 5.4 per cent against the US dollar this year to hit the weakest level since October, with some analysts forecasting further downside
- Lenders including HSBC, Standard Chartered, Bank of China (Hong Kong) and DBS have recorded strong demand for new accounts from mainland clients
Shi from Beijing was at the Bank of China (Hong Kong) branch in the city’s tourist hotspot, Tsim Sha Tsui, at 7.30am on Friday to open a bank account. He had decided to queue there as online appointments in other branches were already fully booked. As the 9am opening time approached, more than 30 people had made a beeline for the door.
“I plan to buy insurance policies in Hong Kong for my children,” said Shi, who only wanted to be identified by his surname. “I’m also considering buying some US and Hong Kong dollars because of the recent depreciation of the yuan and rising interest rates in Hong Kong.‘’
In the same queue, Chen from Suzhou in eastern Jiangsu province said he was looking to buy an insurance policy to diversify his investments. “You should not put all assets in one basket, that is why I came here.”
10:28
‘Let it rot’: surviving China's high unemployment and cost of living
China’s economic health worsened in June and July, with trade, inflation and lending declining while demand at home and abroad shrank. The country is facing a confidence crisis as its piecemeal approach to reviving growth disappointed investors, pressuring its currency.
