Central Banks Will Accelerate Rise Of China's Yuan

Central Banks Will Accelerate Rise Of China's Yuan, Global Survey Shows

Marc Jones  Wed, July 21, 2021

LONDON (Reuters) - The Chinese yuan is on course to become a much more influential part of the global financial system with almost a third of central banks planning to add the currency to their reserve assets, a closely followed survey showed on Wednesday.

The Global Public Investor survey, published annually by the London-based OMFIF think tank, showed 30% of central banks plan to increase yuan holdings over the next 12-24 months, compared with just 10% last year.

It comes despite the differences between Western governments and China on the global stage. The yuan's rise will almost certainly be a global trend, but may be especially strong in Africa where almost half of central banks are planning to increase their yuan reserves.

Rising Interest In The Yuan 

Other eye-catching findings showed that 75% of central banks now thought monetary policy was having excessive influence on financial markets, although only 40% thought these policies needed to be actively reconsidered.

In stark contrast to the yuan, 20% of central banks plan to reduce their holdings of the U.S. dollar over the next 12-24 months and 18% plan to reduce their euro holdings.

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