Yuan Passes Euro as 2nd-Most Used Trade-Finance Currency - Bloomberg
China’s yuan overtook the euro to become the second-most used currency in global trade finance after the dollar this year, according to the Society for Worldwide Interbank Financial Telecommunication.
The currency had an 8.66 percent share of letters of credit and collections in October, compared with 6.64 percent for the euroThe yuan had the fourth-largest share of global trade finance in January 2012 with 1.89 percent, while the euro’s was the second-biggest at 7.87 percent, Swift said.Daily yuan transactions surged to $120 billion in April from $34 billion in 2010, making it the ninth most-traded currency in the world, according to a September report by the Bank for International Settlements in Basel, Switzerland.Wow... well this is just amazing. and terrifying as well.Trading Restrictions
The Chinese central bank limits the yuan spot rate’s daily moves to 1 percent on either side of a fixing it sets every day. The trading band was widened in April 2012, after being expanded from 0.3 percent in May 2007. The yuan in Shanghai has traded 0.7 percent stronger than the fixing on average this quarter, down from 0.8 percent in the first nine months of the year, according to data compiled by Bloomberg.
The People’s Bank of China will “basically” end normal intervention in the foreign-exchange market and broaden the yuan’s daily trading limit, Governor Zhou Xiaochuan wrote in an article in a guidebook explaining reforms outlined following a Communist Party meeting that ended Nov. 12.
More people are trading in yuan than they are trading in euros. Ofc, the top trading currency is still the $ but that just means that now the yuan is competing with the dollar for the world's #1 trade currency and it may be winning.
It gained huge grounds in just 2 year since january 2012...