Add as a preferred source on GoogleLiu Says Beijing May Benefit From a Secondary Yuan Role as Dollar Leads
The renminbi made up 2.11% of global foreign-exchange reserves in the second quarter of 2026, compared with 56.70% for the dollar. Liu identifies foreign access to Chinese investments as a hurdle to wider use.
China may gain from a yuan that can support trade and finance during a crisis without displacing the U.S. dollar, Zongyuan Zoe Liu argued in an Oct. 20 essay.
Liu, the Maurice R. Greenberg Fellow for China Studies at the Council on Foreign Relations, described the potential role as “never the market leader, but serviceable in a pinch.” She argues that a secondary position could help China withstand possible U.S. financial sanctions without bearing the costs of maintaining the world’s dominant reserve currency. Her essay presents a possible strategic benefit, not an announced Chinese government target.
The gap in official reserves remains wide. The renminbi is China’s currency, and the yuan is its unit. Global foreign-exchange reserves totaled $13.22 trillion in the second quarter of 2026, with the dollar representing 56.70% and the renminbi 2.11%. Those shares measure official reserves, not trade payments or every form of cross-border currency use.
Liu points to access to investments as another constraint. Foreign institutions held 3.5 trillion yuan in Chinese bonds at the close of 2025, equal to roughly 1.8% of the 196 trillion yuan market. She argues that wider access to assets foreigners can buy, sell and reinvest would be needed for the currency to gain a larger international role.
China’s payment infrastructure has expanded, but settlement reach and investment access are separate measures. At the end of August 2026, the Cross-Border Interbank Payment System (CIPS) had 1,853 participants — 211 direct and 1,642 indirect — and nearly 5,300 banking entities across 192 countries and regions. As of June 30, 2025, 32 of the People’s Bank of China’s currency-swap agreements with central banks or monetary authorities remained effective, with a combined size above 4.5 trillion yuan.
Liu also sees China’s position in critical minerals, clean-energy equipment and electrical infrastructure as a possible basis for future yuan-priced exports. She presents that as a potential route to demand, not a confirmed change in pricing policy. Her argument follows a separate assessment of the yuan’s prospects against the dollar by Standard Chartered China CEO Jean Lu.