China’s yuan has tightened its grip on global currency markets, rising to 8.5% of all foreign exchange trades this year and keeping its fifth-place ranking worldwide, according to the Bank for International Settlements (BIS) in its 2025 Triennial Central Bank Survey.
The number is up from 7% in 2022, extending a climb that has been building since 2013, when the Chinese currency barely touched 2.2% of daily trades.
The survey, released on Tuesday after being launched in April, shows Beijing’s long campaign to push its currency into global finance continues to leave a mark. The yuan moved from eighth place in 2019 to fifth in 2022 and has managed to hold that position. For China’s policymakers, the push is meant to cut reliance on the US dollar, which the BIS said has actually become even more dominant in the last three years.
Beijing seeks wider yuan adoption in trade and commodities
China’s government has been trying to promote the yuan’s role in global transactions as a way to reduce its dependence on the US dollar.
The BIS said the dollar has actually strengthened its dominance in the past three years, now showing up in 89.2% of forex trades as of April, compared with 88.4% in 2022.
Still, Beijing wants more of the world’s contracts, debts, and commodity sales written in yuan, and policymakers see this as essential for long-term financial independence.
Analysts at China International Capital Corporation, led by Miao Yanliang, said in a note on Tuesday that the currency still lags behind China’s actual economic weight. “The international use of the yuan still does not match China’s size in the global economy and trade,” Miao wrote.
The team argued that Beijing should issue more yuan-backed safe assets and boost the use of the currency in settlement and commodity pricing. They also urged better integration between the onshore and offshore markets, while pointing to the potential of the digital yuan and tokenized assets to make cross-border deals faster and easier to regulate.
The BIS noted that forex trading is just one way to measure a currency’s international reach. Other important areas include how widely it is used in cross-border payments, how much is held in foreign exchange reserves, and how often it is used in pricing global commodities. For now, the yuan’s 8.5% share in the forex market is the clearest sign of its steady climb.
Still, though, gauges of the yuan’s international usage have sent mixed signals this year. For example, its share as a global payment currency in transactions recorded at the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, was 2.9% in August. That’s down from 4.7% in the same month last year.
The BIS survey showed more changes across the currency rankings, as the euro stayed second but dropped to 28.9% of trades, down from 30.6% three years ago. Meanwhile, the Japanese yen stayed almost flat at 16.8%, holding third place, as the British pound sterling plunged to 10.2% from 12.9%, though it remained fourth overall. Behind the yuan, the Swiss franc moved up to sixth, gaining a 6.4% share, compared to eighth place in 2022.
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Source: https://www.cryptopolitan.com/chinas-yuan-8-5-of-global-forex-trades/
