(Reuters) - China's domestic foreign exchange market announced on Thursday that it would launch trading of the yuan against the Australian dollar and Canadian dollar next Monday, the latest currency pairs to be introduced as part of Beijing's efforts to promote the use of its currency.

The announcement by the China Foreign Exchange Trade System (CFETS) confirmed a Reuters' report earlier this week based on foreign bank trading sources.

The move is part of Beijing's efforts to expand the use of the Chinese currency for trade and investment, as a way of reducing reliance on the dollar and thereby simplifying the settlement of trade in everything from energy to manufactured goods.

Traders said China needed to add direct yuan trading against the Aussie because of increasing deals between China and Australia, in particular, in the mining sector.

Adding the Canadian dollar appeared to be a move to acknowledge the importance of one of the Group of Seven economies as well as being part of China's efforts to gradually have trading in all major currencies versus the yuan, traders said.

CFETS said last November when it launched yuan/rouble trading that it would gradually list all major world currencies against the yuan, said a trader at a European bank in Shanghai.

Both Australia and Canada are among China's main trade partners, so the move is not a surprise, he said, adding trading would be relatively strong because of corporate demand.

Traders expect the Singapore dollar and the Korean won to be among currencies in the pipeline to be next traded versus the yuan.

The yuan is currently traded onshore against the dollar, euro, sterling, yen, Hong Kong dollar, Malaysian ringgit and Russian rouble.

The yuan has attracted increasing international attention as China's economy surpassed Japan's to become the second largest in the world.

The yuan is not fully convertible under the capital account but China has made efforts to raise the international status of its currency over the past couple of years.

For one, the government has turned Hong Kong into a center for offshore yuan, as more and more trade is conducted in the renminbi, the official name of the currency, leading the creation of bigger and bigger yuan pools outside mainland China.