Standard Chartered Bank has issued a bold statement saying that by the year 2020, roughly 5 1/2 years from now, 28% of China’s cross-border trade will be settled in renminbi. They have issued a glowing graphic to illustrate their prediction (see below):
To note, just today China’s yuan strengthened and rose beyond the central bank’s fixing for the first time since the currency’s trading range was doubled to 2% in March. This happening amid optimism a recovery in the world’s second-largest economy is gathering pace. LeapRate reported back in late June that a Reuters survey revealed the Renminbi saw its first bullish bets in four months.
Irene Cheung, a Singapore-based strategist at Australia & New Zealand Banking Group Ltd. told Bloomberg: “Letting the market forces have a bigger role in the currency is a good sign that the central bank is comfortable with a modest gain in the yuan. External balances for China, including the trade surplus and capital flows, are constructive for the yuan.”
