(ECNS) -- Foreign central banks are now allowed to open yuan settlement accounts at Chinese financial institutions, the Economic Daily reports.
The People's Bank of China (PBOC),?China's central bank, has permitted its foreign counterparts to open deposit accounts at local banks for bilateral local currency swaps, according to a notice released on its website.
The accounts can't be used for cash withdrawals, the PBOC added.
Institutional investors, including foreign central banks or monetary authorities, are now required to register with the PBOC before investing in the interbank market, according to a notice in July.
After registration, investors can trade bonds in spot and forward markets, conduct interest rate swaps, and trade forward rate agreements. They will be free to decide on the size of their investment.
