Tuesday, October 22, 2013

China Allows Direct Trading Between Currencies With Singapore

SINGAPORE: China and Singapore have agreed to allow direct trading between each other's currency, Singapore's central bank said on Tuesday.

The move, along with other agreements on financial cooperation, is expected to bolster Singapore's status as a leading offshore trading centre for the Chinese yuan, officially called the renminbi (RMB).

China will also grant Singapore-based investors a 50-billion-yuan ($8.2 billion) investment quota under its Renminbi Qualified Foreign Institutional Investor programme, MAS said.

This would allow investors based in the city-state to use the yuan to invest in Chinese stocks and bonds.
Its managing director Ravi Menon added: "Financial ties between the two countries have deepened considerably and Singapore is well placed to promote greater use of the RMB in international trade and investment in the years to come."

China's rise as the world's second biggest economy has seen the yuan take on a bigger role in international financial markets.

(Editor's comment : This is another clear sign that nations are slowly moving away from the US Dollar reserved currency trade.)


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