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Structured medium term notes denominated in renminbi could be set to take off as cuts in interest rates drive Chinese investors to look for a way to boost returns.
International Finance Corporation highlighted the market for the products when it sold its first index linked bond in renminbi earlier this month.
"We will see more structured pay-offs in the market," said Benjamin Lamberg, global co-head of MTNs and private placements for Credit Agricole. "Structured bonds in renminbi have been rare so far but as the interest rates [in China] have gone down, investors need a booster to get a high pay-off."
China's central bank lowered its benchmark rate by 25bp to 5.1% in May, its third cut to the rate in...