The Chinese yuan can easily become No 3 global currency in the next decade unless some major global shocks emerge. Analysts at US financial conglomerate Morgan Stanley predict that the yuan will gain considerable influence in the global financial market and may account for 5% to 10% of global foreign exchange reserves by 2030. If this forecast comes true, the yuan will become the third most important currency in the world. Interestingly enough, the Chinese currency may owe its future success to the US and its sanctions. The fact is, the increased tensions between China and the US push Beijing to open its financial markets to overseas investors and reduce its reliance on the US dollar. So, investors from all over the world start to flock to China’s financial markets and increase the share of yuan in their portfolios. Therefore, the value of investment portfolio inflows to China could reach $3 trillion by 2030. Such impressive volumes will make the renminbi one of the world’s top reserve currencies. According to the Morgan Stanley report, “global demand for yuan-denominated assets could rise in a post-Covid, ultra-low-interest-rate, multipolar world.” So, this is how the Chinese currency can surpass the Japanese yen and the British pound, thus becoming the third most-recognized currency after the US dollar and the euro, experts at Morgan Stanley stress.
