Overview

• The People’s Bank of China raised the minimum floor for yuan-denominated trade transactions from 25% to 40% under its Macro Prudential Assessment framework.
• The directive reinforces Beijing’s long-term de-dollarization strategy by steering major lenders toward expanded yuan use abroad.
• The onshore yuan has gained about 1.6% against the US dollar this year, signaling growing market confidence in China’s currency.
• Regional partners and other trade allies are increasingly settling deals in yuan in response to ongoing US-China tensions.
• China and the United States continue talks under a 90-day tariff truce as Beijing pushes to elevate the yuan’s global role.