Renminbi Makes Top Five of Most Used Currencies
After nearly one year firmly positioned at seventh, the Renminbi (RMB) has entered the top five of world payment currencies since November 2014, overtaking both the Canadian dollar (CAD) and the Australian dollar (AUD) by value, reports SWIFT.
The financial messaging services provider says that just two years ago, in January 2013, the RMB was ranked at position 13 with a share of 0.63%. In December 2014, the RMB reached a record high share of 2.17% in global payments by value and now trails the Japanese yen (JPY) which has a share of 2.69%.
“The RMB breaking into the top five world payments currencies is an important milestone” said Wim Raymaekers, head of banking markets at SWIFT. “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.
“The rise of various offshore RMB clearing centres around the world, including eight new agreements signed with the People’s Bank of China (PBOC) in 2014, was an important driver fuelling this growth”.
Overall, global RMB payments increased in value by 20.3% in December 2014, while the growth for payments across all currencies was 14.9%. The RMB has been showing a consistent three digit growth over the past two years with an increase in value of payments by +321%. Over the last year, RMB payments grew in value by 102% compared to an overall yearly growth for all currencies of 4.4%.
“The RMB is increasingly becoming the currency of choice for international payments,” said Vina Cheung, HSBC’s global head of RMB internationalisation, payments and cash management. “Moving from 13th place to number five in just two years is phenomenal progress. We expect the rapid uptake of the RMB to continue in 2015 and beyond.
“Following 102% growth in 2014 we anticipate the RMB will overtake the JPY as Asia’s top global currency in Q2 2015.”