Renminbi picks up speed

Dim sum bonds and panda bonds are in demand as never before. The Chinese currency is also gaining ground in foreign trade and international payments.

The internationalisation of the renminbi (RMB) has accelerated since the outbreak of the Iran war, according to several local media outlets in China. The bond market, in particular, is currently in the fast lane.

In the first quarter alone, nearly RMB 400 billion (about EUR 50 billion) in dim sum bonds were issued. These are bonds denominated in RMB and issued by domestic and foreign issuers outside mainland China – a 14 per cent plus over the previous year, but in March alone, issuance was 180 per cent higher year-on-year!

Panda bonds are also worth mentioning. These are bonds denominated in RMB and issued by foreign issuers in mainland China. In the first quarter of 2026, securities worth RMB 89 billion were issued here. That is a 100 per cent leap year-on-year. In March, issuance was even 400 per cent higher year-on-year. Even more exciting are the issuers: in addition to Kazakhstan’s sovereign wealth fund, Slovenia became the first Eurozone country to issue panda bonds denominated in renminbi in recent weeks.

Renminbi rising for some time

The latest report on this topic from the People’s Bank of China (PBOC) also shows that the currency’s internationalisation is gathering speed. The report is published annually, though always with a considerable delay. As a result, the version for the year 2024 is currently the most recent. The share of transactions settled in RMB has increased in both the current account and the balance of payments. However, the upward trend was not continuous.

For instance, the growth of cross-border settlements in RMB in the capital account initially fell from 44 per cent in 2020 to 15 per cent in 2022, apparently weighed down by capital market disruptions in China. In contrast, the growth rate of RMB settlements under the current account actually accelerated in 2022 – rising from 17 per cent in 2021 to 32 percent. What was behind this?

One reason at the time was the outbreak of the Russia-Ukraine war, which led to US sanctions against Russia regarding the SWIFT system. Consequently, payment settlements in RMB increased here. This strong growth rate held steady in 2023 as well.

The equivalent of SWIFT, the RMB Cross-Border Interbank Payment System (CIPS), was established by the PBOC in 2015 and processed payments worth RMB 480 billion daily in 2024. By early April 2026, the daily value had already exceeded RMB one trillion (approximately EUR 125 billion).

To fuel internationalisation, the PBOC further relaxed regulations on April 15, 2026, regarding banks’ lending in renminbi overseas. The cap on permitted outstanding loans was raised by 200 per cent for large banks and from RMB two billion to RMB 10 billion for small banks.

Renminbi strengthens in foreign trade

According to PBOC reports, 30 per cent of all cross-border settlements were already being processed in the domestic currency under our country’s current account in 2024, up from 21 per cent in 2022 and less than 20 per cent prior to that.

Settlements for raw materials likely played a decisive role in this. In particular, settlements for so-called “bulk commodities” (raw materials/wholesale goods) conducted in Chinese currency rose from RMB 284 billion in 2020 to RMB 2.1 trillion in 2023. Data for 2024 was not disclosed here.

But even without these figures, it is clear that the pace of the Chinese currency’s internationalisation has risen significantly.