China | Riding the waves: Stocktaking RMB internationalization development

Summary

The RMB is steadily growing as an international currency, with rising use in payments, trade finance, investment, and reserves. However, it still lags behind the USD and EUR. Factors like geopolitical shifts, financial market reforms, and alternative payment systems (CIPS) continue to shape its trajectory.

Key points

• Key points:
• Steady growth in RMB’s global payment and trade finance usage as it gains recognition in international transactions.
• Expansion of RMB in foreign exchange markets and global reserves, strengthening its role as a reserve currency.
• Rising Demand for RMB-Denominated Bonds, Loans, and Investments Reflecting Increased Global Confidence in the Currency.
• China’s Cross-Border Payment System (CIPS) is expanding rapidly, reducing dependence on SWIFT and enhancing RMB Liquidity.
• Increased RMB use in energy markets and geopolitical financial strategies to strengthen its role in global trade settlements.

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