China is pursuing a policy of abandoning the dollar without noise, as the US dollar is losing its position on the world stage, and it is happening quickly, to the extent that many experts and representatives of the largest investment banks have started sounding the alarm.
Goldman Sachs experts have issued a warning that US monetary and fiscal policy, similar to “throwing money from a helicopter,” is seriously undermining confidence in the dollar.
For the first time, real concerns arose about the future of the US dollar as a reserve currency.
China will obviously not miss to take advantage of this situation.
Perhaps there could not be a better moment to strike the weapon of the most important geopolitical competitor, the dollar.
It seems that the Chinese authorities are practically waging a fierce war with the United States on the currency front, but they are doing it quietly, without drawing attention.
Thus, according to the State Administration of Foreign Currencies of the People’s Republic of China, the percentage of payments and receipts denominated in yuan increased in the total foreign exchange transactions that banks made to their clients over a two-year period, from 19 to 37%.
Bloomberg experts, in turn, estimate that, during this period, the use of the dollar by Chinese companies in cross-border transactions fell from 70 to 56%.
These changes can only reflect companies ’desire to reduce currency risk, yet they are in reality more like a systematic abandonment of the US currency.
Russia was the first to fight the US dollar, as it sold nearly all of the US Treasury’s reserves.
Although Russian economy cannot be compared to the size of the two economies, of the United States or China, there are certain benefits to this procedure:
First, getting rid of the US dollar allowed the United States to disarm the dollar in its sanctions policy.
Secondly, the Bank of Russia has transferred a large portion of its reserves to gold, euros and yuan.