It has been just revealed the fact that the yuan managed to overtake the US dollar in China’s cross-border trade. Check out the latest reports about this below.

Yuan vs. the US dollar

According to banking giant Goldman Sachs, the Chinese yuan has surpassed the US dollar in China’s cross-border payments for the first time in history.

In March, the yuan’s share of cross-border settlements hit an all-time high and exceeded the dollar, as reported by Goldman, citing data from China’s State Administration of Foreign Exchange (SAFE).

The bank attributes this significant uptick to foreigners trading renminbi assets.

Goldman notes that China has gained market share and made notable progress in functioning as a medium of exchange in global markets. However, the yuan still has a long way to go to truly compete with the dollar in many ways.

There are concerns over the slow progress in some areas, despite China’s increasing importance in the global market for goods, services, and finance.

The country’s capital controls and limitations on the tradability of the renminbi may hinder its ability to serve as a trustworthy ‘store of value’ and ‘unit of account.’ Currently, the U.S. dollar remains the most widely used currency for international payments, accounting for 43% of transactions in May, according to SWIFT.

The euro, British pound, and Japanese yen make up 32%, 7%, and 3.2% of international payments, respectively.

The bank’s research suggested the fact that payments linked to portfolio investments, like China’s domestic stock and bond market have helped drive the use of the yuan.

The US dollar is reportedly toast

He explained that a group of nations, known as BRICS (Brazil, Russia, India, China, and South Africa), are preparing to introduce a new currency backed by gold.

Kiyosaki believes that this new currency launch, set to be discussed at a conference in Johannesburg, could cause the US Dollar to lose its status as the world’s reserve currency.

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