Investors looking at the Hong Kong market appear more cautious of the bonds of yuan-denominated bonds, which are referred to as ‘dim-sum’ bonds as the rise of the Chinese currency is not certain in the coming months.

The bonds had attracted a lot of inventor attention earlier this year when analysts believed that a low yield will be offset by the steady upward growth in the Chinese currency. However, China's weak export growth, diminished domestic inflation and a stronger U. S. dollar have put pressure on the currency of Asia’s largest economy and its rise against the dollar is not seen as inevitable as it was earlier in the year.

The country released new data on its current account on Tuesday that indicated that the Yuan is floating closer to its fair value, contrary to the popularly held belief in the west that the Chinese currency will rise sharply if freed from the government control.

The surplus for the first three quarters of the year was 3 per cent of gross domestic product, which is below the 4 per cent threshold proposed by the U. S. as the baseline for assessing currency misalignment.

As it appears that there is less to gain from movement in the exchange rate changes, the investors are already demanding higher yields on their dim-sum bonds.