Australia to invest in Chinese bonds

It marks the first time that Australia’s central bank will invest in sovereign bonds of an Asian country other than Japan. It follows events of earlier this month when the Australian dollar became the third currency to trade directly with the Chinese yuan.

"This decision to invest in China is an important one," Philip Lowe, deputy governor of the RBA said in a speech to the Australian Chamber of Commerce in Shanghai. "It reflects the broader economic relationship between China and Australia and our increasing financial ties. It provides greater diversification of our investments and will help with our understanding of the Chinese financial markets.”

Analysts have said that all these moves are a part of China's push for a more global role for its currency. This latest news comes as Beijing has been trying to promote the yuan as an alternative to the US dollar's status as global reserve currency.