Renminbi Isn't Likely to Replace the Dollar Any Time Soon

OUTSIDE China, Mao Zedong is out of fashion these days, remembered less as a revolutionary hero than as a tyrant. But the currency which sports his image on its banknotes is making headway abroad. In Hong Kong some cash machines dispense the “redback”, as the yuan or renminbi is known. In Mongolia 60% of cash in circulation is estimated to be Chinese. The yuan, whose internationalisation really began only in 2009, is now reckoned the seventh-most-used currency in the world, up from 13th a year ago. When China, the world’s biggest trading nation, becomes in the next few years its biggest economy too, many Chinese expect the currency to match its status, ready to challenge the dominance in the global monetary system enjoyed by the American dollar. They will probably be disappointed.

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