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Global transaction services organization SWIFT releases global market share data for CNY at 8.66% in October
The internationalization of the Chinese currency is gathering pace as the Renminbi appears to have achieved another milestone in the month of October according to global transaction services organization SWIFT. The market share in global trade denominated in CNY was reported at 8.66% surpassing the Euro and achieving an impressive growth for the past couple of years.
Its trade share was only below 2% back in January 2012, when it was still the fourth major currency. Ever since the Renminbi has been gaining more global acceptance and the introduction of swap lines and the efforts of the Chinese authorities to promote the use offshore have given quite a substantial boost to transaction volumes.
The Euro has obviously been impacted by internal Eurozone worries and the subsequent flight of external capital from its hard-to-predict exchange rate. The increasing independence of German exports from its Eurozone peers adds to the decline of the market share of the currency from 7.87% in January 2012 to 6.64% currently.
The top 4 countries that are helping prop up this growth (aside from China of course) are Hong Kong, Singapore, Germany and Australia. The first two are major financial hubs, while German exports to China have obviously been playing a substantial role. The proximity of Australia and its very close bilateral trade ties to the People’s Republic are the major reason for the acceptance of the Chinese Yuan as a means of exchange.
In the separate “payments currency in value” study the RMB kept steady its 12th position with a marginal contraction in activity from 0.86% in September to 0.84% in October. CNY payments grew by 1.5%, but overall activity for all currencies has expanded by 4.6%. The US dollar has returned to its top spot with 38.12% surpassing the January 2012 leading Euro dropping in second with 34.69%.
It appears that the efforts of Chinese authorities are paying off, recent PBOC announcements have paved the way forward to the internationalization of the Chinese currency and are likely to go on full speed ahead. For further developments stay tuned to LeapRate as we keep on digging for fresh news on the global acceptance of the Chinese Yuan.