LONDON, March 25 (Reuters) - Britain deepened its financiallinks with China on Wednesday with the launch of Europe's firstyuan-denominated money market fund, which allows investors toget direct exposure to China's interbank lending market.
The exchange-traded fund from China Construction BankInternational, China's second largest bank, islisted on the London Stock Exchange and can be traded insterling, euros and yuan, Britain's government said.
London has been keen to attract Chinese banks and encourageoffshore trade in the yuan to bolster its position as theworld's main centre for foreign exchange trading.
Last year Britain became the first Western government toissue a yuan-denominated bond. On Tuesday the finance ministry'schief economist said he viewed the yuan's possible inclusion inthe International Monetary Fund's currency basket as a "verylive" issue.
"The launch of this (fund) will provide furtheropportunities for British and other global investors to investdirectly into China," said Andrea Leadsom, a junior Britishfinance minister.
The fund is domiciled in Britain and supported by Britain'sHSBC and Germany's Commerzbank.
Some of Britain's link-building with China has createdunease among its traditional allies.
Earlier this month, the United States reacted frostily toBritain's decision to become a founding member of the China-backAsian Infrastructure Investment Bank. (Reporting by Andy Bruce; editing by John Stonestreet)
HSBC Holdings (HSBA)