Beijing, February 16, 2024, The Europe Today: The People’s Bank of China (PBOC), the nation’s central bank, has solidified its financial collaboration on the global stage by signing bilateral currency swap agreements with more than 40 foreign central banks or monetary authorities, as revealed in a recent PBOC report.
Presently, 31 active bilateral currency swap agreements are in effect, boasting a cumulative scale of approximately 4.16 trillion yuan, equivalent to around 586 billion U.S. dollars, as detailed in the report.
Bilateral currency swap agreements involve financial arrangements where one country’s central bank can exchange its national currency for that of another, fostering cooperative financial initiatives between the involved nations.
The funds derived from these swaps serve various purposes, including supporting and facilitating bilateral trade and investment activities. This collaborative mechanism aids in minimizing exchange costs and mitigating exchange rate risks, contributing to smoother economic interactions between the nations involved.
The PBOC report emphasizes that the currency swap agreements entered into by China have played a pivotal role in bolstering market confidence. Moreover, these agreements have been instrumental in maintaining stability in both regional and global financial landscapes, showcasing the positive impact of China’s financial collaborations on the international stage.
