HSBC - "(...) given the country’s enormous global clout China’s currency is still severely under-represented in global trade and capital markets. To become a global currency requires full convertibility. Although this will be done gradually, Beijing policy makers are now more confident than ever about speeding up the process. China’s trade imbalance has been corrected and the RMB’s exchange rate is much closer to its equilibrium level. There is evidence that interest rate liberalisation and other financial reforms are gaining momentum. This will pave the way for the opening of the capital account through further expansion of the Qualified Foreign Institutional Investor (QFII) and the Qualified Domestic Institutional Investor (QDII) share schemes and the removal of restrictions on individual cross-border capital flows in the coming years. We think that, combined with China’s already free flows of both inward and outward direct investment, these moves will make the RMB fully convertible within five years. While some controls will remain, the full convertibility of the RMB will have a profound impact on both China and the world."