Hennes & Mauritz, the Swedish fast-fashion retailer, is considering paying for its clothes in Chinese yuan, the Wall Street Journal reports. H&M buys the majority of its clothes in Asia, but pays about 80% of its purchasing costs in dollars. The company wants to protect itself against a strengthening dollar. More than half of its revenue comes in euros or currencies pegged to the euro, so when the dollar rises against the euro, H&M’s costs rise.
However, the company has yet to make a decision. China still maintains tight control over the yuan and bank fees are costly. Cross-border yuan transactions account for only around 10% of China’s trade, but the country has recently been attempting to make the yuan a more global currency.