China’s yuan is tumbling amid US sanctions and as central banks boost dollar holdings

China’s yuan is in the midst of a steep decline as holders of the currency eye the risk of US sanctions.

The value of the yuan slumped against Russia’s ruble for the fifth day in a row on Wednesday, falling to a level of 11.51 rubles. That’s the cheapest the yuan has been in about a year.

Central banks, meanwhile, are looking to dump the yuan while raising their holdings of the US dollar. Nearly 20% of central bank reserve managers said they planned on raising dollar holdings over the next one to two years, while 12% said they planned on reducing yuan holdings, according to a survey from the Official Monetary and Financial Institutions Forum.

Yuan holders are assessing the risk of Western trade restrictions on China after the US Treasury imposed secondary sanctions on countries and entities doing business with Russia’s economy…..

Source: BUSINESS INSIDER