China holds massive USD reserves to settle trade because most of that at this time is conducted in USD. To get a fair idea , one has to add China & Hong Kong to get the total.
Plaese note that the USA only holds 2.5% of that because it owns the reserve currency.
China began some years ago to cut Yuan/Local currency deal dealing out the USD. Our Iron Ore exporters last Dec agreed to increasing the %age of China imports in Yuan/AUD with the intention of that inceasing incrementally over the next 5 years.
This in no way removes the USD as the international pricing benchmark but deals it out of the actual deal transactions. In other words, its China creep to sidlining the USD as the global reserve currency .
