2014-06-04 — ft.com
China's renminbi is rapidly displacing the US dollar as a trading currency not only in Asia and Europe but now also in the US home market. The value of renminbi payments between the US and the rest of the world rose by 327 per cent in April this year from the same month a year ago (see chart) as more US corporations switched to using the Chinese currency to pay for imports from China, according to data from SWIFT, the international currency settlement firm. The reasons driving the upsurge are structural and long-term, said Debra Lodge, a managing director at HSBC in New York... First, US importers can slash the cost of imports from China by agreeing to trade in renminbi rather than US dollars, Lodge said. Second, a recent surge in the popularity of a host of renminbi-denominated financial market instruments are making it easier for US corporates both to hedge currency risk and to earn an investment return from the renminbi they hold...
Just 2.4 per cent of payments between the US and China/Hong Kong were settled in renminbi in April this year, up from 0.7 per cent in April 2013. However, this is set to change in an emphatic way. "By the end of 2015, we think that 30 per cent of (China's) global trade will be settled in renminbi, up from 13 to 15 per cent now," said Lodge.
Just wait till WalMart switches to this. If they can save a few percent, they have to.
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