The yuan's popularity for global payments has hit a record high for the first time since 2015. Payments using China’s legal tender rose to 3.2%, according to the Society for Worldwide Interbank Financial Telecommunications.
The renminbi has notched the fourth spot as one of the most popular currencies as its usage jumped in recent months. In October 2010, it was ranked 35th on the list. The greenback takes the top slot, the euro holds the second-place ranking, and the pound sterling comes third. China does not seem to stop there and intends to lift the yuan's status as a global settlement currency. Experts say the renminbi will be the biggest beneficiary from de-dollarization. “Trade between various Asian countries and China grows, and more of it is denominated in yuan,” economist Alvin T. Tan emphasized.
The growing popularity of the yuan will provide support for assets denominated in the currency. Some analysts expect China’s bond market to see an inflow of 755 billion yuan to 800 billion yuan in 2022. In addition, the Regional Comprehensive Economic Partnership trade deal that deepens China’s regional foreign trade ties will also encourage member nations to increase yuan asset holdings due to further integration with China.
