Yuan unseats euro in trade finance

[SINGAPORE] The Chinese yuan has overtaken the euro to become the second most-used trade finance currency by value, financial payment network Swift announced yesterday.

As of October, the yuan's share of trade finance activity value was 8.7 per cent, above the euro's 6.6 per cent, though well behind the US dollar's 81 per cent, Swift said.

It has been a quick path up. In January last year, the yuan had a trade finance activity share of just 1.9 per cent.

Bankers told The Business Times that they have been seeing high yuan transaction volumes in the past two years, so its becoming No 2 was to be expected. China, as the world's second largest economy, has become a bigger trading partner for many countries, and some companies do not want exposure to the foreign …