China "internationalizes" its domestic currency.

According to Reuters' estimates based on data from China's State Administration of Foreign Exchange, the yuan was used in 48.4% of all cross-border transactions in China at the end of March, a record high since near zero in 2010.

Meanwhile, the proportion of transactions in USD fell to 46.7%. Specifically, cross-border transactions in Chinese yuan increased from $434.5 billion in February to a record high of $549.9 billion in March.

Chinese President Xi Jinping receives Brazilian President Luiz Inacio Lula da Silva at the Great Hall of the People in Beijing, China, on April 14. (Photo: REUTERS)

According to Bloomberg , this reversal comes as China is striving to increase the use of the yuan in trade and capital markets. China has entered into "de-dollarization" trade agreements with countries such as Brazil.

The yuan has also overtaken the dollar to become Russia's most traded currency since Moscow was isolated from the global financial system last year due to its military campaign in Ukraine.

Argentina also announced on April 26 that it would begin paying for Chinese imports in yuan instead of US dollars. Argentine Economy Minister Sergio Massa said the decision was aimed at preventing the outflow of US dollars.

According to Reuters , the decision was made amid low US dollar reserves and a sharp decline in agricultural exports due to severe drought.

Nevertheless, analysts believe that the US dollar is unlikely to lose its dominant position in the global market in the near future. According to Reuters, the proportion of global trade transactions conducted in US dollars in March was 83.7%, far exceeding the 4.5% of the yuan.

Xuan Mai

Source: https://nld.com.vn/thoi-su-quoc-te/trung-quoc-quoc-te-hoa-dong-noi-te-20230427200047795.htm