Australia and China Sign Currency Pact

Australia's central bank on Thursday signed a currency swap deal with its Chinese counterpart, allowing for up to Aus$30 billion (US$31.2 billion) to be exchanged between the two institutions.

The purpose of the deal, another example of the growing internationalization of China's currency, is to support trade and investment between the two countries, the Reserve Bank of Australia said.

"The agreement reflects the increasing opportunities available to settle trade between the two countries in Chinese renminbi (Yuan) and to make RMB-denominated investments," the RBA said.

"It follows the decision by the Chinese authorities last November to allow convertibility between Australian dollars and Chinese Yuan in the interbank market in China."

The People's Bank of China has signed currency swap deals with a range of other countries including Turkey, the United Arab Emirates, and Malaysia.