You are here: cherry > Press releases for October 2011 > Allianz Global Investors adds to Renminbi fund range with new currency fund

03 October 2011

The new Fund will be one of the first UCITs IV Luxembourg SICAV funds to offer international investors access to Renminbi currency deposits. The Fund will aim to deliver lower risk exposure to the internationalisation of China�s capital markets by investing in a diversified portfolio of high quality Renminbi denominated deposits. The Fund is scheduled to launch to UK investors in Q4 2011 subject to FSA recognition. Nick Smith, a managing director of Allianz Global Investors Europe comments: �We are pleased and excited to offer this new Renminbi Currency fund to UK investors after the success of the Allianz RCM Renminbi Fixed Income Fund, which we closed to new investors to preserve the liquidity of the fund. With launch investments of �450m, the reception of the Renminibi Fixed Income Fund was overwhelming across Europe and we expect a high level of demand. �The Renminbi is not a freely tradable currency but the Chinese authorities are slowly changing this. They want the appreciation of the Renminbi against other currencies to be controlled. The Allianz RCM Renminbi Currency Fund seeks to benefit from this appreciation.� Helen Lam, fund manager of the Allianz RCM Renminbi Currency Fund adds: �The anticipated Renminbi appreciation is 4-7% per annum which makes it an alternative, uncorrelated, investment opportunity. In spite of recent market volatility the Renminbi has appreciated at a faster pace since August which indicates that the Chinese authorities are committed to taking steps to improve the currency�s convertibility with the ultimate goal of internationalising it. �There are several factors that drive the appreciation of the Renminbi. China has over US$ 3 trillion in foreign exchange reserves � a significant accumulation which will provide a level of defense against regional and global market crashes. �Furthermore, the Chinese government is shifting its economy away from exports and low-cost manufacturing to domestic consumption and investment. A stronger Renminbi against the US dollar should reduce the domestic money supply and abate inflationary pressures. Although inflation may have peaked in China, it is anticipated that inflation is likely to remain sticky and will range between 5-6% in the medium term. �Finally, China has sustained high growth compared to developed economies recently and it continues to have a trade surplus with most of its major trading partners. �Offshore Renminbi deposits offer a good level of liquidity and the Fund will look to capitalise on this.�

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