Renminbi Liquidity Arrangement
On June 25, 2022 the central bank of China inked an agreement with the Bank for International Settlements (BIS), for establishing a Renminbi Liquidity Arrangement (RMBLA).
About Renminbi Liquidity Arrangement
- The Renminbi Liquidity Arrangement will provide support to participating central banks during market fluctuations.
- It could be used in periods of market volatility in future,
- In addition to People’s Bank of China, the first participants of this arrangement would include Bank of Indonesia, Hing Kong Monetary Authority, Central Bank of Malaysia, Central Bank of Chile and Monetary Authority of Singapore.
- Participant will contribute a minimum of 15 billion yuan.
- Funds could be contributed either in yuan or US dollars.
- Funds would be placed with the BIS, in a bid to create a reserve pool.
Bank for International Settlements (BIS)
BIS is an international financial institution. It is owned by central banks that “fosters international financial and monetary cooperation as well as serves as a bank for central banks. BIS completes its work through meetings, programmes and the Basel Process. It also provides banking services, but to central banks, and other international organizations. It is headquartered in Basel, Switzerland. Representative offices are there in Hong Kong and Mexico City.
It is the official currency of China and one of the world’s reserve currencies. As of April 2019, it is ranked as eighth most traded currency worldwide. Yuan is the basic unit of renminbi. People’s Bank of China issue renminbi monetary authority of China.
People’s Bank of China
People’s Bank of China is the central bank of China. It carries monetary policy and regulation of financial institutions. It is a cabinet-level executive department of State Council.
Month: Current Affairs - June, 2022
Category: International / World Current Affairs
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