PBOC Greenlights Offshore RMB FX Trading for Six Major Banks at Lujiazui Forum

China’s foreign exchange market has taken another step toward two-way opening: a pilot program for offshore RMB foreign exchange trading has been launched in the Shanghai Free Trade Zone, sending a clear signal of Beijing’s commitment to broadening cross-border market access.

People’s Bank of China (PBoC) Governor Pan Gongsheng announced at the 2026 Lujiazui Forum that six banks — Industrial and Commercial Bank of China (ICBC), Agricultural Bank of China (ABC), Bank of China (BOC), China Construction Bank (CCB), Bank of Communications (BoCom), and China CITIC Bank — have been authorized to conduct offshore RMB foreign exchange trading via the China Foreign Exchange Trade System (CFETS) platform.

All six banks successfully completed their first batch of transactions. As of 19:00 on June 17, a combined 125 trades had been executed for a total notional value of RMB 7.238 billion.

The initial product suite includes spot, forward, and swap contracts, with currency pairs covering offshore RMB against the U.S. dollar, euro, Japanese yen, Hong Kong dollar, pound sterling, and Canadian dollar.

“This move will help advance two-way opening of China’s FX market, enhance cross-border investment and financing convenience, make it easier for foreign capital to invest in Chinese assets, and broaden investment channels for domestic investors going overseas,” said Ming Ming, chief economist at CITIC Securities.

In December 2024, the People’s Bank of China and the State Administration of Foreign Exchange (SAFE) guided CFETS to launch offshore RMB FX trading services for the Shanghai Free Trade Zone, providing a new platform for financial institutions within the zone (via their Free Trade Accounting Units) and offshore counterparties to transact in offshore RMB.

Since launch, the service has been warmly received by the market. More than 50 institutions have conducted offshore FX trades through the CFETS platform, with cumulative turnover exceeding USD 250 billion.

In recent years, China’s FX market has continued to deepen, with a growing diversity of onshore and offshore participants — ranging from foreign central banks and sovereign wealth funds to international financial organizations and overseas commercial banks. The depth of the RMB FX market has gradually expanded, and the linkage between onshore and offshore markets has continued to strengthen.

According to the Bank for International Settlements (BIS) 2025 Triennial Central Bank Survey, the RMB is the world’s fifth most actively traded currency, with average daily turnover in China’s onshore FX market reaching USD 235.1 billion — an increase of more than 50% versus 2022.

“By expanding the pilot to six commercial banks, the onshore and offshore markets will be more closely connected. This will help balance FX supply and demand through both channels and is conducive to maintaining stable operation of the FX market,” said Lian Ping, chairman of the China Chief Economists Forum.

The expansion of pilot participants is also seen as a key step in sharpening the international competitiveness of Chinese financial institutions.

Industry sources noted that some Chinese banks had previously conducted offshore RMB FX trading through their overseas entities and Free Trade Accounting Units, building up the team capabilities, trading experience, and risk management frameworks needed to participate in offshore markets.

Insiders believe that direct participation by the six Chinese banks will help further improve their market-making, trading, and pricing capabilities in the FX market, while cultivating more financial professionals who understand international rules and possess a global outlook.

China Construction Bank President Zhang Yi stated bluntly at the forum that, leveraging their global service networks, large commercial banks are well positioned to provide a variety of cross-border financial services, helping Chinese companies “go global” and international capital “come in.” He added that CCB is actively advancing integrated development of local and foreign currency, onshore and offshore business, and is strengthening its professional teams for overseas clients.

Demand for offshore RMB trading has been climbing steadily. Guo Lei, chief economist at GF Securities, observed that the globally synchronized industrial technology cycle requires globally allocated factors of production, and capital must “flow.” This calls for richer offshore RMB products and improved liquidity management frameworks to empower cross-border trade and investment through high-level two-way opening.

“Unswervingly expanding opening is a powerful driver and critical safeguard for high-quality financial development, and a key measure to further enhance the financial sector’s capacity to serve the real economy and improve international competitiveness,” Pan Gongsheng said at the forum, adding that further steps will be taken to develop the offshore RMB FX market based on pilot outcomes.

Pan also noted that the PBoC will next step up the supply of offshore RMB bonds and derivatives, support Hong Kong in building a global offshore RMB business hub, and foster a deep and active offshore RMB market overseas.