Concerns over the value of the RMB are more than justified, as the national currency continues to slip down a very steep slope. But there is even more reason for concern, as the Swift RMB Tracker indicates that the Euro suddenly surpassed the RMB in trade finance. Although the US Dollar remains firmly in the top position, things are going from bad to worse for the renminbi rather quickly.

Euro Becomes The Second-Most-Active Currency in Trade Finance

For the longest time, it was assumed the

This trend is not entirely unexpected, though, as the RMB has been decreasing in usage since 2014. Although the Chinese currency remains a leading currency in the financial sector, it appears things are only going further downhill from here. In fact, its usage has dropped by nearly 50% in the past three years. However, trade finance across all the great currencies has dropped in value by 35% since October 2013.

Michael Moon, Swift Asia Pacific Head of Payments Markets, stated:

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

A similar trend can be noted in the international payments department, where the RMB lost a position in the rankings. The RMB payments value between September 2016, and October 2016, also dropped by 22.44%, indicating that there is plenty of reason for concern over the future. Although it is not uncommon for currencies to go through ups and downs at this time of the year, such a sharp decline is rather worrisome.

The Chinese economy is not in a good position right now, due to falling exports and the devaluation of the Yuan. Investors are trying to move funds out of China to other

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