BEIJING, June 5 -- The central bank Friday issued guidelines on foreign-exchange primary dealers, defining their roles, responsibilities and qualifications.

    Foreign exchange primary dealers would engage in foreign exchange transactions with the People's Bank of China (PBOC), and also serve as market makers, said the guidelines posted on the PBOC Web site.

    The names of the primary dealers and their deals will remain confidential, it said.

    The central bank said the guidelines will help it effectively carry out monetary policy, and maintain a stable yuan foreign exchange rate at an appropriate and balanced level.

    Under the guidelines, which took effect immediately, the central bank's office in charge of open-market operations would supervize the primary dealers and their trading. China already has primary dealers that take part in the open-market operations of the PBOC, including 40 commercial banks, according to the central bank's Web site.

    A banker at a Japanese bank in Shanghai said the guidelines could be a step toward the PBOC using foreign exchange swaps to better control money market liquidity and the forex rate.

    "Last year's foreign exchange swap was only open to 10 banks. There's been talk about using foreign exchange swaps on a regular basis to control liquidity," he said.