Australian dollar could be traded directly

CHINESE and Australian central banks are considering direct trading between the yuan and the Australian dollar, central bank Governor Zhou Xiaochuan said yesterday.

If a deal is reached, the Australian dollar would be the third major currency allowed to be traded directly against the yuan, following the US dollar and the Japanese yen.

Other currencies used as intermediaries for China-Australia currency trading are sometimes unstable, said Zhou.

Bilateral trade, investment and tourism relations between China and Australia have developed rapidly in past years, resulting in growing demand for direct currency trading.

The Chinese and Australian central banks support direct trading, said Zhou, adding that it would be "a good thing, a matter of course and a choice that respects the market."

Meanwhile, Shang Fulin, chairman of the China Banking Regulatory Commission, said the government did not have "prejudiced regulations" on private investors seeking participation in the banking sector.

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