De-dollarization is not working out in China, where businesses are hanging onto their US dollars

• Chinese businesses are holding back from converting their foreign-exchange earnings to Chinese yuan.
• This is because of the yuan's weakness against the US dollar and higher offshore interest rates.
• The potential for "yuanisation" remains, given China's expanding trade ties and financial infrastructure.

China has been trying to expand the clout of the Chinese yuan amid a broader trend to diversify away from the US dollar.

But even Chinese businesses aren't sold on the yuan right now.