China is intensifying its efforts to promote the yuan globally by enabling domestic banks to directly settle foreign currencies and bypass the U.S. dollar in cross-border trade. Six Chinese commercial banks have incorporated approximately a dozen foreign currencies, including the Thai baht, Brazilian real, and Kazakhstan tenge, for direct yuan settlement this year. These currencies are primarily linked to emerging markets and China’s Belt and Road trade network. The move aligns with China’s broader strategy to internationalize the yuan and reduce reliance on dollar-based settlements. Markets are also monitoring the potential impact on gold prices, as dollar weakness could drive gold prices higher.
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