UPDATE 1-China to test longer onshore yuan trading hours Dec 23-30 -sources

(Add source quotes, background)

SHANGHAI, Dec 22 (Reuters) - Trading hours for China’s onshore yuan will be extended on a trial basis from Wednesday through Dec. 30, three people with direct knowledge of the matter said on Tuesday.

During the test, trading hours for the China Foreign Exchange Trade System (CFETS) will last until 11:30 p.m. Shanghai time (1530 GMT) rather than end at 4:30 p.m. as currently, they said.

All three people declined to be identified as they are not authorised to speak to the media.

Officials at CFETS could not be reached for comment.

Reuters reported in October that the CFETS would soon extend trading hours to overlap with those in Europe, one of China’s reforms to internationalise the Chinese currency.

Dealers have said the change will also give international and Chinese markets more chance to react together to events.

“The test will enable the CFETS to be poised to extend trading hours early next year,” said one of the people, adding that the exact starting date has yet to be decided. (Reporting by Lu Jianxin and Nathaniel Taplin; Editing by Kazunori Takada and Richard Borsuk)