The Chinese yuan has become the second-biggest trade funding currency in the world, surpassing the euro for the first time, according to a new report from Swift, the global messaging system for cross-border financial transactions.
The yuan’s share of global trade payments rose to 10.2% in August, from 8.8% in July, while the euro’s share fell to 35.8% from 36.3%. The US dollar remains the dominant trade funding currency, with a share of 40.5%.
The yuan’s rise is due to a number of factors, including the Chinese government’s efforts to internationalize the currency, the growing importance of the Chinese economy in global trade, and the relative strength of the Chinese economy compared to other major economies.
The yuan’s rise is likely to have a number of implications for the global economy. It could lead to increased trade between China and other countries, and it could also make it easier for Chinese companies to raise capital abroad. It could also lead to increased competition between the yuan and the dollar as the world’s reserve currency.
Overall, the yuan’s rise is a sign of the growing importance of China in the global economy. It is also a reminder that the world economy is becoming increasingly multipolar, with China and other emerging economies playing a more important role.
Here are some of the implications of the yuan’s rise for the global economy:
Increased trade between China and other countries: The yuan’s rise could make it easier for Chinese companies to do business with companies in other countries, which could lead to increased trade between China and other countries.
Increased capital flows to China: The yuan’s rise could make it easier for Chinese companies to raise capital abroad, which could lead to increased capital flows to China.
Increased competition between the yuan and the dollar: The yuan’s rise could lead to increased competition between the yuan and the dollar as the world’s reserve currency.
The yuan’s rise is a significant development, and it is likely to have a number of implications for the global economy. It is important to monitor the situation closely and to assess the potential impact of the yuan’s rise on the global economy.