New guidelines may strengthen Beijing's policy options

New guidelines for primary foreign-exchange dealers, which China says will help with monetary policy and maintaining a stable yuan, will take effect immediately, the Wall Street Journal reported. The new guidelines call on the office at the central bank in charge of open-market operations to supervise primary dealers and their trading. China made its first foreign-exchange swap deals with local banks in November. The deals give the government another way to guide currency and interest rates. The new guidelines did not make it clear if foreign banks could be primary dealers although there are some foreign banks that serve as market makers in the foreign-exchange market.