The yuan became the most-used currency for China’s cross-border payments in March, surpassing the U.S. dollar for the first time, according to official data analyzed by Reuters. While the yuan share of overall global currency transactions at 4.5% in March, the cross-border development aligns with China’s effort to increase the use of its currency in international trade.
In March, cross-border payments and receipts in Yuan rose to a record $549.9 billion. This was up from $434.5 billion in February, according to a Reuters calculation based on data from the State Administration of Foreign Exchange.
Overall, the yuan was used in 48.4% of cross-border transactions in March. The dollar meanwhile was used in 46.7% of cross-border transactions, down from 48.6% a month prior.
NEW: For the first time ever, the Chinese Yuan has overtaken the US dollar as China’s most used currency for cross-border transactions.
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According to a report from Bloomberg, the latest figure demonstrates the yuan’s meteoric rise in Chinese cross-border transactions over the past decade. In 2010, the yuan’s share was near 0% while the U.S. dollar’s share was 83%, Bloomberg found.
China has long sought to increase the yuan’s share of global currency transactions. Outside China’s borders, the currency accounts for a fraction of the U.S. dollar’s share, however.
Data from SWIFT showed that the yuan’s share of global currency transactions had risen to 4.5% in March. The dollar accounted for 83.71% of transactions in the same period.
Still, the yuan has seen its usage increase in recent years, especially following the conflict in Ukraine and subsequent sanctions that froze Russia’s foreign exchange reserves. As a result of the sanctions, the yuan has replaced the dollar as Russia’s most-traded currency after the nation was largely cut off from global finance.
China has also entered non-dollar trading agreements with a handful of nations, including Brazil. The Chinese government has also pushed for similar arraignments with Saudi Arabia.