Forex

China's Golden Week market closures set to thin liquidity in the yuan and Asian assets

During China's Golden Week holiday, onshore markets will be closed and Hong Kong will lose its link to mainland exchanges for several days, leaving the offshore yuan and Asian assets trading on thinner liquidity.

Hong Kong will trade on October 2, 5, 6 and 7 without flows through Stock Connect, the mechanism linking it to mainland exchanges. With the onshore yuan market closed, the offshore yuan will drive price discovery with less trading depth, and mainland commodity and financial futures will also be shut for the week.

For beginners When a major market is closed for a holiday, the remaining venues trade with fewer participants, which can amplify price swings on any news that breaks during that period.