China’s central bank said it will further remove restrictions on using the RMB across borders and will continue opening domestic financial markets in Beijing’s effort to enable the RMB to better compete with other major currencies, reported Caixin.
The People’s Bank of China (PBOC) saidit will insist on a market-oriented method to facilitate trade and investment and further expand access to foreign investors who use the RMB to invest in Chinese bonds and stocks, according to its latest annual RMB Internationalization Report, which was released Friday.
The report touted that the cross-border use of the RMB sustained rapid growth last year even as economic growth slowed. However, the internationalization of the RMB still has a long way to go given the currency’s small share in the global market.
The RMB’s share of the foreign exchange market rose to 4.3% last year, up 0.3 percentage points from 2016, the report said. The currency ranked fifth globally as a payment currency, but was only used for 1.76% of payments. By comparison, China accounts for more than 10% of the world’s goods trade.