PBoC to extend onshore yuan trading hours

– The Yuan is officially recognized as a legal currency in Zimbabwe after Chinese forgives debt. Since 2009, Zimbabwe has abandoned its own currency, the Zimbabwean Dollar, due to hyperinflation and political crisis in Harare causing the value to their currency to plummet.

Zimbabwe would adopt the Chinese Yuan as per condition that the Government of China would cancel the return of debt payable by Zimbabwe amounting to 40 Million US $.

In the long run, though, the basket could reduce China’s demand for dollars and US government debt, since it has to buy fewer dollars to manage the yuan, and pave the way for Beijing’s oft-stated goal of making the yuan a global currency.

The bank has launched renminbi clearing services in more than 20 countries and regions globally as important infrastructure in offshore markets.

Independent economist, John Robertson said the introduction of the Chinese yuan will not make much of a difference to the economy, as now there is no money in the country.

The yuan hasn’t been approved yet for public transactions in the Zimbabwean market which is now dominated by the United States dollar.

“The Chinese are determined to make their currency as prestigious as possible and this is a cheap way for them to be able to claim that their currency is becoming more internationally accepted – it’s now legal tender in another country”, Cohen said.

It then started using a slew of foreign currencies, including the U.S. dollar and the South African rand.

– PBOC encourages more qualified foreign institutions to participate in China’s domestic foreign exchange market.

The People’s Bank of China’s (PBOC) latest stimulus measure should be positive for the region if it prevents a further slowdown of the Chinese economy, the Bangko Sentral ng Pilipinas (BSP) said. According to The New York Times, China now accounts for 82 percent of the country’s foreign investments. Over the past year, those exports have fallen while Chinese exports to the continent are increasing.

Zimbabwean President Robert Mugabe on Tuesday slammed local banks for charging high interest rates, which, he said, stifled economic recovery.

In recent weeks the yuan that is traded in Hong Kong, where it is not subject to any restrictions, has consistently traded below its mainland counterpart as foreign investors expect the currency to depreciate further amid China’s slowing economy.

But African analysts rolled their eyes at what they say is more of a publicity stunt by one of the world’s economic basket cases than a deal with real consequences on the ground.

The International Monetary Fund last month admitted the yuan into its benchmark currency basket, a recognition of Beijing as a global economic power. “Consistent with our prediction, China’s fiscal policy will be more proactive and monetary policy will remain accommodative”.

China is ready to cope with possible risks arising from the renminbi being included in the IMF SDR basket, although volatile cross-border capital flows and more fluctuations in exchange rates are likely following the move, said Yi Gang, deputy governor of the People’s Bank of China, at a news briefing on Dec 1.