Shanghai, China -
China has started to allow its national currency, the Yuan, to begin trading against the Australian and Canadian dollars in an effort to begin promoting its currency as an alternative to the U.S. Dollar for international trade and business.
China has set an official goal of 2020 to make Shanghai as an international leading business city. "This is part of official efforts to enrich trading products in the Chinese market," said Liu Dongliang, currency analyst at China Merchants Bank in Shenzhen. "In addition, both Australia and Canada are China's important trade partners," he said. "In particular, because of its strong links with Australia, China's economic and market movements often have some influence on the Australia dollar."
"The PBoC [People's Bank of China] has so far still been pricing the fixing of other currencies based on the yuan's near peg versus the U.S. dollar."
The yuan opened at 6.1266 against the Canadian dollar, after the PBoC set the yuan/Canadian dollar's mid-point at 6.1048, and was later trading around 6.1227.
It opened at 6.2769 against the Australian dollar, also slightly weaker compared with the PBoC's fixing of 6.2491, and fetched around 6.2714 later in the session.