Chinese Yuan Surpasses US Dollar As Most-Used Currency In Cross-Border Transactions
Official data reveals that in March, the yuan took over the dollar as the most extensively utilized currency for cross-border transactions in China, marking the first time this has occurred.
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April 26, 2023
Reuters reported that official data reveals that the Chinese yuan surpassed the US dollar as the most widely-used currency for cross-border transactions in China in March. Cross-border payments and receipts in yuan hit a new high of $549.9 billion, up from $434.5 billion the previous month.
The yuan's share of cross-border transactions rose to 48.4%, while the dollar's declined to 46.7%. China has been actively promoting the use of yuan for cross-border trades to internationalize its currency. Although the yuan's use in global trade finance remains relatively low, it has experienced steady growth. In March, the yuan accounted for 4.5% of global currency transactions for trade finance, compared to the dollar's 83.71%, according to data from SWIFT.
In March, the Chinese Yuan's share of international payments remained essentially unchanged at 2.3%, according to SWIFT. The weakening of the yuan against the dollar has not helped either, with the central parity rate falling on April 26. Larry Summers, former Treasury Secretary, has also dismissed the notion of the Chinese yuan posing a threat to the dollar, citing concerns about Chinese markets' reliability and the current capital outflows from China.
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