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China to Increase Yuan Flexibility and Enhance Yuan-based Trade (14.1.2011)
China will increase the flexibility of its yuan exchange rate and further push forward the opening-up of its financial markets, a senior central bank official said Friday. The central bank will also work to expand trials of cross-border yuan settlement activities to facilitate trade and investment.
One-third of China's cross-border trade may be settled in yuan by 2016, as the Chinese government pushes for the internationalization of the currency. According to data from HSBC, the average monthly volume of yuan-settled trade surged from 0.6 billion yuan ($90 million) in 2009 to 68 billion yuan in the period between June and November 2010. Transaction volumes increased sharply after the People's Bank of China first launched a pilot scheme for yuan trade settlements in June 2009 and expanded it a year later.
One-third of China's cross-border trade may be settled in yuan by 2016, as the Chinese government pushes for the internationalization of the currency. According to data from HSBC, the average monthly volume of yuan-settled trade surged from 0.6 billion yuan ($90 million) in 2009 to 68 billion yuan in the period between June and November 2010. Transaction volumes increased sharply after the People's Bank of China first launched a pilot scheme for yuan trade settlements in June 2009 and expanded it a year later.
China's central bank announced on Thursday that the nation's qualified enterprises and banks could settle their overseas direct investment in yuan, a move that could speed up the currency's globalization. The People's Bank of China (PBOC) said on its website that, banks and enterprises which are allowed to settle the cross-border trade in yuan are permitted to conduct direct investments overseas using yuan, or RMB.