Caterpillar sells RMB bonds in HK

Caterpillar (CAT.NYSE) became the second US firm to issue renminbi-denominated debt on Hong Kong’s bond market Wednesday, the Wall Street Journal reported. The construction equipment maker issued US$150.5 million worth of two-year bonds at a 2% coupon. The coupon is among the lowest in recent renminbi bond issues – including the 3% coupon for renminbi bonds recently issued by McDonalds – which analysts say demonstrates an anticipated appreciation of the currency and strong investor appetite for renminbi-denominated debt. Caterpillar has been rapidly expanding its China operations, and recently opened a new plant in Tianjin. The World Bank’s financing division, International Finance Corp, and Russian aluminum producer United Co. Rusal (486.HK) have also indicated interest in issuing renminbi-denominated bonds in the near future.