China is promoting the use of its currency as an alternative to the dollar in global trade and finance and more and more nations now want to capture the fast-growing market for offshore trade in yuan, also known as the renminbi [Xinhua]
Overtaking the Canadian dollar and the Australian dollar, China’s yuan has become the world’s fifth most widely used payments currency, according to the Society for Worldwide Interbank Financial Telecommunication (SWIFT).
The value of cross-border deals settled in the Chinese currency, yuan, more than doubled in 2014, shows new data from SWIFT showed Wednesday.
China’s policy makers are seeking to boost the currency’s convertibility and global use.
The yuan reached a record high share of 2.17 per cent in global payments by value in 2014.
The U.S. dollar, euro and British pound remain the top three world payment currencies.
The yuan surpassed the euro in 2013 to become the second-most used currency in global trade finance.
“It is a great testimony to the internationalisation of the RMB and confirms its transition from an ‘emerging’ to a ‘business as usual’ payment currency,” Wim Raymaekers, head of banking markets at SWIFT, said in the statement on Wednesday.
China is promoting the use of its currency as an alternative to the dollar in global trade and finance and more and more nations now want to capture the fast-growing market for offshore trade in yuan, also known as the renminbi.
The Chinese currency is already traded directly against the US dollar, the euro, the Japanese yen, the British pound, the Aussie and New Zealand dollars, Russia’s rouble, the Singapore dollar and Malaysia’s ringgit. Yuan settlement in trade surging from 2.06 trillion yuan in 2012 to 3.01 trillion yuan in 2013 worldwide.
Last week, Zurich joined a growing list of international hotspots like Sydney, Seoul, Paris, Luxembourg, London, Frankfurt, Singapore and Hong Kong which are already global centres for trading the yuan.