Seven Chinese banks and brokers, including Bank of China and Industrial and Commercial Bank of China, have agreed to support an initiative by the London Metal Exchange to encourage greater participation by China in setting prices for metals, The Financial Times reported. Among the goals of the deal are price convergence between Chinese and global markets, greater use of LME-approved warehousing systems and aiding the yuan’s internationalization. China currently consumes 40% of global base metals, is the world’s largest metals producer and accounts for 20% of business on the London exchange. The country lacks a true international exchange thanks to capital controls that limit market access for foreign investors.
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