President Xi Jinping has publicly committed China to building a "strong currency" for international use, a declaration published by Qiushi, the Communist Party's theoretical journal, on January 31, 2026. The timing of the release is significant—Xi delivered the speech in 2024 to provincial and ministerial officials, but Beijing chose to publish it now amid mounting questions about U.S. dollar stability and global financial market volatility.
The announcement represents more than economic policy. It is a statement of strategic intent. Xi outlined three core requirements for financial powerhouse status: a strong economic foundation, world-leading technological strength, and a widely-used, credible currency. He acknowledged candidly that China remains "big but not strong" overall in financial terms, framing yuan internationalization as a long-term structural project rather than a near-term goal.
In China, as across Asia, long-term strategic thinking guides policy—what appears reactive is often planned. Beijing has spent a decade building cross-border digital RMB infrastructure, establishing currency swap arrangements with the UAE, Saudi Arabia, Singapore, and Hong Kong. The public release of Xi's remarks signals confidence in challenging dollar dominance, not through confrontation, but through gradual displacement.
The yuan's current global footprint remains limited. Daily transactions through China's Cross-Border Interbank Payment System average roughly 700 billion yuan ($100 billion)—far below the nearly $2 trillion cleared daily through the dollar-based SWIFT system. Yuan-denominated international debt issuance represents just 0.8 percent of global markets.
Yet the yuan has generally strengthened against the dollar over the past year. Goldman Sachs estimated the currency could be trading approximately 25 percent below its fair value, suggesting room for appreciation as China's financial system deepens.
This is about power, not just economics. A reserve currency confers the ability to finance deficits, sanction adversaries, and shape global financial architecture. China's central bank has methodically expanded bilateral currency swap lines, digital yuan pilot programs, and commodity pricing in yuan—infrastructure that can be activated when geopolitical conditions shift. The speech's publication now suggests Beijing believes those conditions are shifting.
