The Yuan cannot become the world's reserve currency (second, third or otherwise) for a simple reason - the Yuan is not stable and cannot provide the level of liquidity that the US has. Plus China is trying, so far without results (except for a couple of not the smartest countries) under the far-fetched ideology of "dedollarization", to transfer some of the nearest countries to the yuan, i.e. to yuanize their economies, making them dependent on the collapsing Chinese economy. More precisely, to make these countries donors of the Chinese economy to save it.
At the same time, China is very happy to sell its goods for DOLLAR. And buys their goods and services from the countries, economic appendages, for YUAN. This is done for the purpose of saving China's economy by accumulating stable currencies (dollars/euros) and exporting inflation and problems from China via the Yuan, which is accumulated by "China's unfortunate friends"
Your perspective is valid and insightful regarding the challenges China faces in making the Yuan a global currency. These hurdles include stability of financial markets and acceptability of Yuan as a viable global currency. The dominance of US dollar in international trade has deep historical roots, making it challenging for any currency to disrupt established practices and perceptions. While China has succeeded to some extent to promote Yuan in international agreements, there is still a need for concerted efforts through bilateral trade with key trading partners, to further advance its global standing.
In the context of the topic of opening post, it is worth mentioning here that China holds the largest foreign exchange reserves (3.1 trillion US dollars approximately), yet Yuan faces challenges in maintaining stability against the US dollar.
First off - thanks for the assessment
Secondly - China... how can I explain it in a simpler way....It is probably more accurate to say that China wants to create a "world currency of the second world under the guise of the first world". Let me clarify what I mean. In order for a currency to become a "world currency", it is necessary not only to desire it, but also to create a lot of conditions. From political and military potential, to influence on the world economy, leadership in technology, conditions, ..... and a dozen other indicators. China now has only a little - a lot of population, a lot of problems, ties with dubious regimes, building a totalitarian regime.... and that's it! Against the background of US advantages - it looks, to put it mildly, "very small".
But China found a group of countries (and hesitant), where logic and reason were replaced by populism and propaganda, and where China was able to slip them the yuan on the wave of absolutely fake hysteria "dedollarization" ! No one else needs the yuan ! From the word ABSOLUTELY NOT NEEDED ! But the export of economic problems through the yuan - for China is an option to solve the problems of domestic economic problems, at the expense of the economies of these victim countries, and officially "friends of China ...
Thirdly - yes, China is the largest holder of US government bonds, and is now increasing their volume again, which is easy to check !
