Russia Hints Buying Chinese Yuan With Aggression In Year 2023January 1, 2023
As per the latest reports, Russia is interested to change its strategy related to the forex markets in the upcoming year.
The reports claim that Russia is planning on purchasing the Chinese yuan if certain conditions are fulfilled.
Gas and Oil Revenue Expectations to be met
It has been revealed that Russia may show interest in buying the Chinese yuan with aggression if the expectations are met for gas and oil revenues.
The information has been shared by two inside sources who are aware of the matter and the entire developments involving China and Russia.
Acceleration of De-dollarization
Russia and China are the two countries many states from around the world believe are the greatest rivals of the United States.
The United States is not at all on good terms with Russia and China. They have a great disagreement when it comes to global economic strategies and diplomacies.
For a long time, Russia has seen the United States as its greatest rival and the same is the case with China. However, at the moment, both Russia and China are having a bad time.
On one side, there is China which is facing the worst economic situation due to COVID-19 and supply chain disruptions.
Then there is Russia which is despised by the West including the United States for waging war against Ukraine. It is facing the worst waves of sanctions being imposed by the EU and the US.
The country is also facing a major economic crisis due to the export and oil sale disruptions.
For a long time, both Russia and China have tried to defeat the US in the race to be the strongest economy. They wanted to become the largest economy in the entire world.
To achieve this goal, both countries have attempted the de-dollarization tactic. Due to the recent downtrends, the Russian economy is nowhere near the US economy.
However, China has the potential to defeat the US economy as the United States is now moving closer to a recession. With the perfect opportunity in sight, both Russia and China have set their plans in motion.
With the US economy facing the worst time, both countries have accelerated their strategy for de-dollarization. They are eager to reduce the dependence of the entire world on the dollar.
This way, the world will be able to move away from Western finance and act independently for the first time in decades.
Moscow is Support Beijing
As many things have gone against Russia since the beginning of 2022, it knows that it is going to take time before it can fully return to its potential.
However, it is eager to take down the dollar as the largest reserve currency. For this purpose, Russia has joined hands and is willing to boost the value of the Chinese yuan in the market.
The majority of the trades carried out between Russia and China are taking place in yuan and rouble. Both countries are avoiding their exposure to the dollar, which is causing the dollar price to take fall.
As the usage of the dollar decreases in the forex and trading markets, its value would eventually experience a downturn.
The dollar is already facing a downtrend due to internal hiccups and now, it is facing external pressure.
Two of the strongest economic powers in the entire world are after the dollar and they will eventually bring it down.
If the US Feds do not come up with strategies to deal with such tactics, then the dollar will lose its spot as the largest reserve currency.
For now, Russia is attempting to perform most of the trades in the yuan and rouble. On some days, the forex markets are seeing spikes for RUB/CNY that are higher than the trading volume of the USD in the market.