Why did Brazil cut a US dollar deal with China?

Brazil has just cut a deal with China to ditch the US dollar when paying each other for trade goods. It’s the latest victory in Beijing’s long-term drive to stomp on the greenback and establish the yuan as the dominant international currency. The deal, announced Thursday, has revived concerns about the US dollar’s future.

Can Brazil trade with China without US dollar?

Brazil and China (President Xi Jinping above) have agreed to trade goods without using the US dollar as an intermediary currency. Picture: Grigory Sysoyev The Brazilian Trade and Investment Promotion Agency describes the new deal as promoting “even greater bilateral trade and facilitating investment” with China.

What does the US dollar deal mean for Brazil & China?

The deal, announced Thursday, has revived concerns about the US dollar’s future. Brazil and China will directly exchange payments without first converting their currencies to a trusted third-party economy. That’s the traditional role of the greenback. Serious issue. US policy has been too heavy-handed, making countries want to ditch the dollar.