The renminbi slipped to No. 3 in the currency ranking by value for trade finance amid a weak global economy.  

The Chinese currency has been overtaken by the euro, which is now the second most-active with a share of 4.61%. The renminbi’s share in trade finance - letters of credit and collections - by value shed 66%, according to global payments service provider Swift.

Three years ago, the renminbi was ranked #2 in trade finance with a share of 8.66%. Since October 2013, the trade finance values in renminbi have decreased, whilst trade finance across all currencies decreased in value by 35%. 

“The general slowdown of the Chinese and world economies over the past few years has impacted global trade growth across all currencies, not just the renminbi,” says Michael Moon, head of Payments

Markets, Asia Pacific, Swift. “For example, commodities trade growth has been declining as evidenced by the reduction of documentary trade.  On a positive note, the inclusion of the renminbi in the Special Drawing Right (SDR) basket should generate further trust and confidence in the renminbi currency and support further renminbi internationalization.”

In terms of international payments, compared to September 2016, the renminbi has dropped one position to No. 6 in the currency rankings for international payments, with a share of 1.67%. This month’s decrease is likely due to seasonal effects following the Golden Week holiday in China in October. renminbi payments value decreased by 22.44% compared to September 2016, whilst in general payments currencies decreased by only 5.96%.