Tokyo and Beijing announced a series of broad, innovative financial agreements on Sunday that could potentially change the status quo of this world’s financial system.
According to these agreements—which were reached between Chinese Premier Wen Jiabao and Japanese Prime Minister Yoshihiko Noda—China and Japan may soon be trading with each other using their own national currencies, without first converting to American dollars. The agreements will also allow Japan to hold Chinese yuan in its foreign exchange reserves, which are now largely dollar-denominated.
