When financial messaging provider Swift published its latest RMB Tracker in late January, almost no one noticed.
For good reason. Anyone not focused on US politics or Australian fires was fretting about the growing threat of coronavirus.
While too late to prevent the pathogen escaping into the wider world, China has pumped $22 billion into its markets and cut banks’ reserve ratios. More monetary and fiscal stimulus will surely follow.
However, it’s worth backtracking to Swift’s January report. That it garnered little traction doesn’t matter: it’s what it contains that matters.
Reading the title, you’d assume China’s currency, the renminbi, was well on track to being an international currency. Yet since its inclusion in the IMF’s basket of special drawing rights in October 2016, the RMB’s star has, if anything, waned.
In December 2017, Swift reckoned it to be the fifth largest payments currency, with a global market share of 1.61%. Two years later, that number had risen slightly to 1.94%, yet the RMB slipped in the rankings to sixth behind the Canadian dollar, with Australia’s and even Hong Kong’s dollar nipping at its heels.
