NEW YORK -- The U.S. Commodity Futures Trading Commission (CFTC) and the China Securities Regulatory Commission (CSRC) have entered into a memorandum of understanding to share information about futures markets and perspectives on regulation.

The arrangement includes sharing information for the sole purpose of building and maintaining "open, efficient and financially sound futures and options markets," the CFTC said.

The basis of the understanding, said Andrea Corcoran, director of international affairs for the CFTC, is to help China develop a futures market. "It is an offer for us to explain to them our system. China has an interest in modernizing its capital markets and this is a statement of intent to speak generally."

With China's rich physical commodities, Corcoran said, the agreement would help the CSRC, the Chinese commodities regulator, to understand the workings of the U.S. markets in a technical sense to enable it to modernize its operations.

Corcoran said that China did not have futures contracts in metals but would be looking at developing that market in the future. "This is a signal that they are interested in talking about components of well-operated commodities markets."

Corcoran said this was only the first step and the terms for implementing the memorandum of understanding had not been fleshed out.

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