19th June 2026

Pictet: The renminbi's quiet transformation

China's renminbi isn't ready to challenge the US dollar's supremacy. But the currency is quietly reconfiguring the global financial system nevertheless.

At first glance, it looks like a missed opportunity.

While central banks worldwide have been reducing their exposure to the US dollar, partly in response to President Donald Trump’s trade policies and military interventionism, the Chinese renminbi doesn’t seem to have gained very much from the greenback’s growing unpopularity.

It accounts for just 2% of official foreign exchange reserves, almost the same level as a decade ago. Hardly the outcome Beijing would have been hoping for given its publicly-stated ambition to challenge the dollar’s reserve currency status.

But a deeper analysis suggests that Chinese authorities should not be feeling too aggrieved.

Across several dimensions, the renminbi is making steady progress towards internationalisation, and its advance is quietly reconfiguring global commerce, finance and investment.

International trade is one area where it is making its presence felt. Official figures show that the unit has risen into the top tier of globally-traded currencies. A report from the Bank for International Settlements finds that the share of foreign exchange trades denominated in the renminbi reached 8.5% by the end of last year, up from 7% five years earlier.

The Chinese currency has closed the gap on pound sterling, the fourth most traded currency, while also widening its lead over the Swiss franc, the Australian dollar and the Canadian dollar.

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