On Tuesday, the Bank for International Settlement (BIS) published its triennial survey of global FX and interest rate markets. The survey is worth looking at because, well, it comes around only every three years. What I find interesting about the survey is to look at the rise of the Chinese Renminbi (CNY) as a global currency. There are a lot of people out there who think that with the rise of China the US Dollar may lose its status as the world’s reserve currency to the Renminbi. One necessary condition to become a major reserve currency is to have a deep and liquid market. And indeed, the average daily transaction volume in the Renminbi is growing at breakneck speed. Since 2010, the trading volume in Renminbi has grown by about 26% per year on average. Compare that to the 6% average growth rate in US Dollar transactions and you understand that the Renminbi is catching up fast.
The Renminbi is getting more important, but…
The Renminbi is getting more important, but…
The Renminbi is getting more important, but…
On Tuesday, the Bank for International Settlement (BIS) published its triennial survey of global FX and interest rate markets. The survey is worth looking at because, well, it comes around only every three years. What I find interesting about the survey is to look at the rise of the Chinese Renminbi (CNY) as a global currency. There are a lot of people out there who think that with the rise of China the US Dollar may lose its status as the world’s reserve currency to the Renminbi. One necessary condition to become a major reserve currency is to have a deep and liquid market. And indeed, the average daily transaction volume in the Renminbi is growing at breakneck speed. Since 2010, the trading volume in Renminbi has grown by about 26% per year on average. Compare that to the 6% average growth rate in US Dollar transactions and you understand that the Renminbi is catching up fast.