Bloomberg running a story from their sources close to the scene
- Peoples Bank of China allowing overseas lenders classified as participating banks to buy and sell CNY onshore through clearing or agent banks to raise yuan for direct investment in China
Previously only trades under current account were permitted for CNY purchases/sales in onshore market
- Offshore clearing banks and local agents can also now trade yuan forwards and swaps rather than just spot
- PBOC requires overseas participating banks to step up scrutiny on client demand for yuan purchases and sales; monitor capital flows
PBOC has not responded to Bloomberg fax asking for confirmation
If true then these latest moves can be seen as further progression by China to open up yuan trading, still with one eye on achieving IMF SDR status
