China and Japan face common challenge from depreciation of US currency and are internationalizing their own

Japan announced recently that it has obtained permission from China to buy 65 billion renminbi ($10.3 billion) of Chinese government bonds and will seek to set up an offshore renminbi-trading center in Tokyo, signaling its support for renminbi internationalization.

The agreement for Japan to buy Chinese government bonds is a result of the bilateral consensus reached between the two countries at the end of last year during the visit of Japanese Prime Minister Yoshihiko Noda to China. During Japanese Finance Minister Jun Azumi's visit to Beijing last month, a new consensus was reached on bilateral financial cooperation, such as establishing an offshore renminbi market and promoting direct trading of the renminbi and the yen.