Turkish lira-Chinese renminbi trade set to begin

China’s foreign exchange trade watchdog announced Friday that direct trading between China’s renminbi (yuan) and the Turkish lira will start on Sunday, Dec. 12.

In order to promote bilateral trade and investment between China and Turkey, facilitate the use of the renminbi and lira in cross-border trade and investment, and meet the needs of economic entities to lower currency conversion costs, with the authorization of the People's Bank of China, direct trading between the renminbi and lira will be launched on the interbank foreign exchange market starting Dec. 12, said a statement on the Chinese Foreign Exchange Trade System (CFETS) website.

The move comes as Ankara is seeking ways to strengthen the lira through foreign trade and investments and cushion Turkish markets from the sharp global volatility seen in foreign exchange markets, especially in the U.S. dollar, seen in wake of Donald Trump’s surprise presidential victory.

Also on Thursday, ICBC Turkey, the first Chinese bank active in Turkey, announced that it became the first bank to use the money swap agreement signed by both countries’ central banks to boost trade in local currencies.

Recently, President Recep Tayyip Erdogan said Turkey had proposed doing trade with Russia, China, and Iran in local currencies, stressing the importance of using such currencies in foreign trade.