Currency traders will be able to exchange Japanese yen directly for Chinese renminbi, and vice versa, without using the US dollar as an intermediary beginning today, AFP reported. Chinese regulators set the trading band for the yen-renminbi at 3% for those trading through Shanghai , allowing for exchange rates to fluctuate more compared to the 1% band set for the dollar-renminbi trade. Those trading in Tokyo will not be restricted by the band. Rates will likely be similar in both trading centers as sellers choose the market with the more favorable rate, said Akira Hoshino, head of forex trading at Tokyo-Mitsubishi UFJ Bank. The deal with Japan is part of China’s efforts to internationalize its currency. “We can lower transaction costs and reduce settlement risks at financial institutions as well as making both nations’ currencies more useful” through direct trading, said Japanese Finance Minister Jun Azumi.
You must log in to post a comment.
Yes, I would like to receive emails from China Economic Review. (You can unsubscribe anytime)
Copyright © 2018 SinoMedia Group Limited All rights reserved