Yuan Forwards Discount Widening Shows Dim Sum Risk: China Credit

Yuan forwards are trading at the biggest discount to the spot rate in four years and the top Dim Sum debt underwriters predict a halt to appreciation.

Contracts that fix the currency in 12 months were 2.42 percent weaker than the current rate in Shanghai today, the most since February 2009, according to data compiled by Bloomberg. The currency has advanced 1.6 percent against the dollar since the end of 2012. The average yield on offshore yuan-denominated debt climbed to a five-month high of 3.8 percent on June 10, an HSBC Holdings Plc index showed.