- ECB and People’s Bank of China extend euro-renminbi currency swap arrangement for another three years
- Swap arrangement has maximum size of CNY 350 billion and €45 billion ($52.7bn)
- Arrangement serves as backstop liquidity facility to address potential shortages of Chinese renminbi at euro area banks
The European Central Bank (ECB) and the People’s Bank of China (PBoC) have decided to extend their bilateral euro-renminbi currency swap arrangement for another three years until 8 October 2028. The conditions of the arrangement remain unchanged.
The ECB and the PBpC established the first three-year bilateral currency swap arrangement on 8 October 2013, with a maximum size of CNY 350 billion and €45 billion. This was subsequently extended in 2016, 2019 and 2022, each time for a further three-year period.
From a Eurosystem perspective, the arrangement serves as a backstop facility to address potential sudden and temporary CNY liquidity shortages for euro area banks as a result of disruptions in the renminbi market. Liquidity-providing arrangements contribute to global financial stability. The arrangement with the PBoC is consistent with the large volumes of bilateral trade and investment between the euro area and China.