Want China Times, Xinhua 2013-06-23
Mervyn
King, governor of the Bank of England and Zhou Xiaochuan, governor of the
People's Bank of China, have signed an agreement to establish a reciprocal
three year sterling/renminbi currency swap line, according to an announcement
on the Bank of England's website on Saturday night.
The maximum
value of the swap is 200 billion yuan/20 billion pounds (US$32 billion). The
swap line may be used to promote bilateral trade between the two countries and
to support domestic financial stability, the British bank said. Governor Mervyn
King said that it is a testament to the outstanding working relationships
between the two banks that this swap line has now been signed.
The
establishment of a sterling/renminbi swap line will support Britain's domestic
financial stability. In the unlikely event that a generalized shortage of
offshore renminbi liquidity emerges, the Bank will have the capability to
facilitate renminbi liquidity to eligible institutions in Britain. "On
behalf of the Bank, I am grateful to governor Zhou and the staff at the
People's Bank of China, with whom it has been a pleasure to work," King
said.
The
agreement follows the announcement of discussions between the Bank of England
and the People's Bank of China on 22 February.
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