Indonesia Turns to China’s Yuan to Cut Reliance on the U.S. Dollar

China’s local government debt keeps rising as weak real estate cuts land revenues, forcing more bond issuance and reliance on subsidies.
China’s local government debt keeps rising as weak real estate cuts land revenues, forcing more bond issuance and reliance on subsidies. (Photo: FRED DUFOUR / AFP)

China’s yuan is taking a larger role in Indonesia’s currency markets, as Bank Indonesia opens new yuan-denominated monetary operations. This new facility aims to reduce reliance on the U.S. dollar. It also aim to support the fast-growing use of local currencies in trade with China.

Bank Indonesia said it will introduce instruments in China’s yuan and Japan’s yen as part of its foreign-exchange monetary operations.

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by Edwin Shri Bimo

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