Traders Go Nuts for Newly Available Yuan

Currency traders are going wild over their latest toy: China’s yuan. In the few months since Beijing allowed its currency to be bought and sold outside the mainland, daily trading has shot from zero to $400 million, the Wall Street Journal reports. Though China still maintains strict control over the yuan’s value, traders say demand is so strong that big banks around the world are setting up systems and offices to deal in it.

“This is the beginning of a new era,” says the head of Hong Kong’s central bank. “This is a step moving to full convertibility of the yuan.” One researcher predicts that the yuan could soon pass the Japanese yen as the third most-actively traded currency, behind the dollar and euro. HSBC, meanwhile, thinks that within three to five years, half of China’s cross-border trade will be conducted in yuan. (More yuan stories.)