China and Britain have renewed their bilateral local currency swap agreement for a further three years, and increased the swap line from 200 billion yuan to 350 billion yuan (£35.72 billion), the People’s Bank of China (PBOC) said on Wednesday, Reuters reported. The renewed pact, announced during a state visit to Britain by Chinese President Xi Jinping, will provide liquidity support for the renminbi market in London and help finance bilateral trade and investment deals, the PBOC said in a statement on its website. The increase in the value of the swap line reflected the continuing growth of renminbi trading in London, the Bank of England said in its statement. “The renewal of this swap line and its increased size reflect the constructive approach that the Bank of England and the People’s Bank of China are taking to support the development of an effective and resilient renminbi market in London,” Mark Carney, Governor of the Bank of England, said in the statement. The PBOC said the pact could be renewed in future, based on mutual agreement. China has made efforts to promote the yuan, also known as the renminbi, as an international currency while London has been keen to attract Chinese banks and encourage offshore trade in the yuan to bolster its position as a non-Asian yuan trading center.
