Ding Zhijie, dean of finance at the University of International Business and Economics in Beijing, said that direct currency trading between the two countries would provide greater opportunities for bilateral trade to be settled in domestic currencies, rather than the US dollar.

"It will help lower currency trading costs and reduce the risks of using domestic currency.

"It will also improve the convertibility of the renminbi in Australia, and the level of acceptance for both currencies in the global market," Ding said.

Zhang Jianping, a researcher at the Institute of International Economic Research under the National Development and Reform Commission, said the currency trading agreement was meant to meet a growing demand from expanding bilateral trade, which reached $122.3 billion in 2012.

In addition, an easier swap process will also save tourists some foreign exchange costs, which is good news for Chinese customers on shopping tours of Australia, Zhang said.

However, "the internationalization of the RMB needs more of such direct trading agreement to be signed, so as to establish a clearance mechanism for trade settled in yuan.

"Moreover, there are a lot of items under our capital account that need to be gradually opened, therefore it will still be a long time before the RMB can become a major international currency," Zhang said.

Dariusz Kowalczyk, an analyst at Credit Agricole, wrote in a research note: "We do not expect a lot of trading volumes as most flows are still settled in the US dollar, but the announcement represents an important move in collaboration between the two countries and in the development of offshore markets.

"It is also another small step in reducing the global role of the US dollar and boosting the role of the RMB."

Li Xiaokun contributed to this story.

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