BRICS Watch: De-Dollarization and the Chinese Yuan Demand-pull:


By Chinedu Okoye 


De-Dollarization Campaign Gains Steam:

China's De-Dollarization campaign gains steam as the Chinese Yuan in demand from a global expansion of overseas trade using Yuan for settlements. This makes the remninbi the BRICS anchor currency by virtue of being the most demanded BRICS currency and the PBOC's gold hedge.

In the ZE paper on January 8th, 2024 titled: ‘BRICS Watch: Risks and Tricks of the De-dollarization Campaign’ it was posited that the Yuan would need to take lead for the De-Dollarization campaign to materialize as too many (BRICS) currencies cannot at the same time be raised in prominence, but can be affected by the rise in Yuan's prominence.

This position seems to have materialized, with the increasing global demand for the Yuan.


The Yuan Emergence:

Then, BRICS nations had gradually commenced bilateral trade settlements in local currencies, powered by currency swaps.

This was the begining of a renewed Yuan dominance that led to a major de-dollarization of economic ties between these countries as the share of the Yuan in global payments systems rise from 1.9% to 3.6% by October 2023.

Since then, cross border trade settled in Yuan rose 12% to 9.97 trillion Yuan (or $1.4 trillion) is roughly covers 30% of trade in the period (first three quarters of the year) — @Bloomberg November, 5, 2025.

This we attribute to the China led coalitions attempt to gradually De-Dollarize economic ties. This was to be done “in a uniform manner”, with a selection of a strong enough currency leading the pack (see screenshot from the said article below)


Why China Leads the Pack:

The alliance seems to have found that currency in the Yuan. The dominance of the Chinese currency is strategic and doesn't negate the demand or value of other partner countries.

China's Gold Accumulation, as pointed before on ZE Blog, arms it with monetary ammunition, for future expansions without sacrificing too much value.

The demand for the currency exceeds the BRICS to many major trading partners alliances from its diversified export market  helped the Yuan which is set for it's biggest annual gain in three years.

Yuan Stability and Strength In Charts:


(Chart 1: USDCNY 5-year ∆)

The Yuan has been fairly stable over the last three years and more, owing no small amount to it's gold accumulation and in the last five years, from depicted in chart 1 above.

The Yuan fell against the USD in the period from late through mid 2022, where the USDCNY faced resistance at around 7.4/$1, since then it has covered around the 7/1 mark.


(Chart 2: USDCNY year-on-year ∆)

The currency strength shown in the year-on-year (see chart 2  above)and year-to-date chart (see chart 3 below), legitimizes it's monetary policy moves, and strengthens the case for a continuous acceptance or increased growth in usage going forward.

(Chart 3: USDCNY year-to-date)

The Yuan's prominence is dependent on its stability, and increased usage, and armed with two of the worlds most trusted assets – the greenback/Treasuries and Gold – the stage is set for a gradual increase in dominance, as the Yuan, backed by major BRICS countries and other partner countries.


ZE on Positioning for African Central Bankers:

African central bankers would do well to monitor the situation and adjust reserve assets accordingly, if and when it becomes appropriate and prudent to do so.

Countries already e trading huge volumes with China would also benefit from an early reserve currency asset allocation, in favor of not just the Remninbi (Chinese Yuan), but Gold as well.

Any reserve shift should remain gradual and data-driven, and most of all innovative, as liquidity and convertibility in Yuan markets remain thinner compared to the Dollar or Euro.


An Uphill Battle:

While the Yuan’s share in global payments rose to 3.6%, the dollar still commands over 40%, highlighting the scale of the challenge but also the pace of change.

China’s partial capital controls and limited convertibility still constrain full Yuan internationalization, keeping the De-dollarization wave gradual rather than revolutionary. Optimism, and expectations must be balanced with caution.

The Yuan’s rise is less about dethroning the Dollar and more about offering the world an alternative — one that’s gold-anchored, trade-driven, and increasingly hard to ignore.

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