The European Central Bank (ECB) and the People's Bank of China (PBOC) agreed to a direct swap – bypassing the dollar – as trade increases between the two areas. You can read the article here.
China is the European Union's second-largest trading partner behind the U.S. The EU exported 71.4 billion euros worth of goods to China in the first six months of this year and imported 133.6 billion euros worth, according to data from Eurostat, the European Union's statistical office.
The implications for the dollar are severe… Because the dollar is the world's reserve currency, foreign nations must change their money to dollars before transacting. This agreement between the ECB and China – which lasts for three years – pushes the dollar out of the equation and strengthens the yuan. In comes Gold