China's central bank to support cross-border RMB interbank financing business

 China's central bank on Thursday said that it will support domestic banking financial institutions to engage in cross-border RMB interbank financing business with overseas institutions.

The move will facilitate the openness of the country's capital account, develop the offshore RMB market and improve the macroprudential management of cross-border capital flows, according to a notice issued by the People's Bank of China.

Cross-border RMB interbank financing is an important channel for domestic banks to provide RMB liquidity to the offshore market and promote the cross-border use of the RMB.

The notice covers various types of RMB cross-border interbank financing business and sets relevant parameters for macroprudential management, allowing for countercyclical adjustments based on market conditions.

The central bank said it will promote the implementation of the notice steadily, effectively leveraging the positive role of cross-border financing businesses in serving the real economy and promoting the healthy development of the offshore RMB market.