The Yuan Is an Unlikely Winner From Russia’s Growing Isolation
The Chinese currency is expanding its reach and is now seen as an antidote to what many view as Washington’s weaponization of the global financial system.
A new regional currency?
Photographer: Kirill Kudryavtsev/AFP/Getty Images
China’s influence over the Russian market just got a lot more intense. For the first time in the history of the Moscow Exchange, the yuan overtook the US dollar as the most traded currency last month with a market share close to 40% of trading volume .
As significant as this is, the conventional wisdom on financial markets holds that as long as China declines to make the yuan fully convertible, it will not be able to rival the dollar or euro as a global currency. It’s difficult to argue with that, and SWIFT data demonstrates the yuan’s share in international payments has shown mediocre growth since 2016, when the Chinese currency was admitted to the International Monetary Fund’s special drawing rights basket.