The Governor of the People’s Bank of China, Zhou Xiaochuan, will sign a swap agreement tomorrow with the Mongol Bank on exchanging national currencies between the two central banks. The agreement will ensure the stability of the MNT by putting yuan into the market in an emergency.

This is expected to be the first such understanding with the central bank of a neighboring country. Exploratory talks have already been held with Russian officials for a similar agreement with the Bank of Russia.  That meeting was attended by President Ts.Elbegdorj, Speaker D.Demberel, Advisors of the Prime Minister, representatives of the Ministries of Finance, of Foreign Affairs and Trade, of Road, Transportation and Urban Development, of Mineral Resources and Energy, the Mineral Resources and Petroleum Authority, the General Customs Administration, Ulaanbaatar Railway and  private sector companies that have trade relations with Russia. An agreement, if and when signed, is expected to help Mongolia tide over the trade deficit with Russia, which is expected to rise with increasing petroleum import at higher prices.