SEOUL - The direct foreign exchange trading market between the currencies of China and South Korea has worked smoothly despite reduced trading volume for the first five months of this year, South Korea's central bank said Thursday.

The Bank of Korea (BOK) said in a statement that the won/yuan direct trading market in Seoul worked smoothly given the stable trading volume and the effective operation from the perspective of the exchange rate and price.

During the January-May period, the won/yuan direct transaction volume in Seoul reached a daily average of $1.55 billion.

It was down 20.5 percent from $1.95 billion tallied in the same period of last year.

Volatility in the won/yuan exchange rate fell to 0.38 percent in the January-May period from 0.45 percent a year earlier.

The direct won/yuan trading market was launched in December 2014 to assist the trade settlements between companies of the two countries.

The percentage of the Chinese currency settlements in trade by South Korean companies reached 5.9 percent of the total in 2016, up from 3.1 percent recorded in 2015.