China and Britain have reached a three-year deal to swap their currencies when needed, the first such agreement between Beijing and a major developed economy and a move that could help boost the Chinese yuan outside Asia.
In a statement released late Saturday, the Bank of England said Governor Mervyn King and his counterpart at the People’s Bank of China, Zhou Xiaochuan, signed an agreement to set up a three-year swap line with a maximum value of 200 billion yuan ($32.6 billion). It means that Bank of England could draw on the line with the PBOC when there is a sudden shortage of yuan funds in the U.K. market—and make the yuan, also known as renminbi, available to banks under its jurisdiction.
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Lingling Wei and Paul Hannon, The Wall Street Journal via CHINA US Focus http://feedproxy.google.com/~r/ChinaUsFocus/~3/cbOCbjSyjqQ/
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