According to the Sunday reports the central bank governors of China and Brazil have come to the agreement to enable the trade between the two states in national currencies instead of dollar. Talking at the Bank for International Settlement's annual general meeting in Basel People's Bank of China Gov. Zhou Xiaochuan and Banco Central do Brazil President Henrique Meirelles said they would study how to implement the plan.

The two central banks want to bypass dollar to settle trade invoices in Chinese yuan and Brazilian reals.

"We agreed to start studies on implementing trade in the local currency. We will gradually move away from the dollar as trade between the two countries," Dow Jones Newswires quoted Meirelles as saying, citing reported remarks in the Estado de Sao Paulo newspaper. 

According to Zhou next step in the move is for Brazilian President Luiz Inacio Lula da Silva and Chinese President Hu Jintao to discuss the arrangement. He said that the plan would not necessarily involve a currency swap like those China has in place with other countries.