And I’m not sure what you mean by the yuan having more inherent value.
I mean that countries buy products from China which means that they can always convert yuan into something they need. This was basically the premise behind petrodollar as well. When you could only buy oil in dollars, that made dollar valuable as an international currency.
How much the country backing the currency exports isn’t particularly important.
Of course it’s important, it’s why Russia is currently trading with India in yuan instead of rupees. They can’t spend rupees on anything they need, but they can spend yuan.
As the yuan grows in popularity, the dollar will certainly lose some status, but it’s not likely to crash.
Both UK and Japan are in an incredibly precarious economic situation right now, and US has astronomic debt servicing of which is directly tied to global demand for dollars. If this demand starts shrinking then US will not be able to service the debt and will be forced to default.
https://www.wilsoncenter.org/blog-post/china-top-trading-partner-more-120-countries
I mean that countries buy products from China which means that they can always convert yuan into something they need. This was basically the premise behind petrodollar as well. When you could only buy oil in dollars, that made dollar valuable as an international currency.
Of course it’s important, it’s why Russia is currently trading with India in yuan instead of rupees. They can’t spend rupees on anything they need, but they can spend yuan.
Both UK and Japan are in an incredibly precarious economic situation right now, and US has astronomic debt servicing of which is directly tied to global demand for dollars. If this demand starts shrinking then US will not be able to service the debt and will be forced to default.