The latest stop on the renminbi’s whistle-stop tour to international stardom is Taiwan. From now on, Taiwanese banks will be able to clear transactions in the “redback”, making Taipei another offshore renminbi centre alongside Hong Kong. With Singapore and London jostling to be next and China now firmly established as the world’s second-largest economy, surely it can only be a matter of time before much of the world’s trade is settled in renminbi and central banks are holding a substantial part of their reserves in the Chinese currency?

Not so fast. The “internationalisation of the renminbi” – and never was something so vital for sophisticated dinner-party chatter so hard to pronounce – is as much hype as reality. A look at history is useful. By the time the dollar supplanted sterling as the go-to international currency around 1925, the US had been the world’s biggest economy for more than 40 years. Even then, it took the first world war and massive disruption of European trade to cement its place. True, China’s industrialisation is happening at warp-speed. It is possible that the internationalisation of its currency will move at a similar pace. But there are reasons to doubt that the renminbi is yet ready to join the dollar, or even the euro, as a global currency.

On the surface, progress looks impressive. Since things got started in 2009, offshore renminbi deposits in Hong Kong have leapt from almost nothing to 9.5 per cent of total banking deposits. Trade settlement in renminbi has gone from 2 per cent of Chinese trade in 2010 to 9 per cent in 2011. The issuance of “dim sum bonds”, renminbi-denominated paper issued in Hong Kong, has gathered pace. Caterpillar, McDonald’s and Tesco, plus several banks, including HSBC, are among those to have issued dim sum bonds. At the national level, China has entered into renminbi liquidity swap arrangements with more than a dozen countries from Argentina to New Zealand.