Cover Story: Why the Yuan Is Suddenly Gaining International Traction

China’s 13-year push for greater international use of its currency is suddenly gaining traction. The yuan now accounts for nearly half of China’s domestic and foreign currency cross-border settlements, and foreign governments and businesses are coming increasingly to consider it as an alternative to the U.S. dollar.

Cross-border yuan settlements surged 29% to 36.61 trillion yuan ($5.12 trillion) last year compared with 2020, according to the People’s Bank of China’s (PBOC). Such payments are likely to continue rising this year after climbing 15.7% year-on-year in the first half, the central bank said.