China will permit banks to trade foreign currency swaps for corporate clients from March 1, The Wall Street Journal reports. According to the State Administration of Foreign Exchange, banks that have been eligible for at least one year to issue foreign-exchange swaps will be able to issue currency swaps without additional approval.
Banks will also be allowed to decide the durations of swaps and the specific currencies they offer to clients. The forex regulator added the interest rates in currency swaps can also be set by the two parties, though they must be in accordance with the central bank’s rules on deposit and loan rates.
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