Yuan trading under accounts to widen

BUYING and selling yuan will be allowed by a wider range in the future, as China stands firm on promoting financial opening up, the central bank said.

Earlier this year, the People’s Bank of China issued a circular on improving the management of selling and buying yuan in response to a higher level of the currency’s convertibility under the capital account and progress in its internationalization and financial opening up.

“The requirements of market entities for the convenience of trading the yuan have been on a constant rise,” the PBOC said in a statement on its website.

In the circular, yuan trading was allowed across the current account, compared with the previous scope of just goods trade and service trade under the current account.

Meanwhile, yuan trading under the capital account was expanded to approved crossborder securities investment, while previous rules only allowed trading of the yuan for direct investment, the PBOC said.

“In the future, with the constant expansion of the opening up of the financial sector, the business scope of approved cross-border securities investment will continue to rise, and the scope of yuan trading will expand correspondingly,” the statement said.

After increasing investment quotas for the Shanghai-Hong Kong and Shenzhen-Hong Kong stock connect programs this year, authorities are making preparations to launch the Shanghai-London stock connect program within the year.

At present, overseas participants of yuan trading only include companies and institutions, not individual investors, PBOC said.