Taiwan to launch RMB reference rates

Taiwan's monetary authorities will launch daily reference rates for yuan circulated on the island starting from Sept 1, in a major step for the island's progress as an important offshore RMB center.

The decision was made to set up benchmark RMB rates following a huge increase in yuan deposits due to Taiwanese banks started offshore RMB businesses in February, 2013.

The reference rates, which gauge the costs of borrowing in RMB, will be used to price yuan-denominated contracts and derivative products to expand the island's RMB businesses, according to a statement by Taiwan's monetary authorities on Thursday.

The Taipei Foreign Exchange Market Development Foundation is authorized to be the regulator of the rates, and Thompson Reuters will serve as the calculating agent.