Yuan Surpases Euro As Second Most Used Currency In Global Trade Finance first appeared on Floating Path.
Data released for the month of October by the Society for Worldwide Interbank Financial Telecommunication shows that China’s yuan accounted for 8.66% of all international letters of credit and collections, what SWIFT refers to as “traditional trade finance.” For perspective, in January of 2012, the yuan was responsible for only 1.89% of trade finance.
In October, the Euro fell to third place in such usage with 6.64%, while the U.S. Dollar maintains a dominant (yet declining) 81.08%.
As for global payments, the yuan held tight in 12th position. Even though value of payments grew by 1.5% for the month, payments in all currencies rose by 4.6%. According to SWIFT’s Asia Pacific Head of Payments and Trade Markets, Franck de Praetere, the yuan’s popularity abroad as well as in Asia is clear.
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“The RMB is clearly a top currency for trade finance globally and even more so in Asia, as shown by SWIFT’s business intelligence statistics on the pace at which China’s exporters and importers and their counterparts use the RMB for Letters of Credit.”
According to Bloomberg, the yuan is also the 9th most traded currency in the world, with daily transactions recently hitting $120 billion.