The number of Euro-denominated international payment transactions routed through SWIFT (Society for Worldwide Interbank Financial Telecommunications) has steadily declined. That’s a big drop, which means people are starting to favour the US dollar and the Chinese yuan more.
The use of the Euro in international transactions saw a significant drop in July, hitting an all-time low, according to figures released by SWIFT and cited by numerous media sites this week. Several news organisations have covered this story this week.
According to the findings, the percentage of global transactions completed using the currency that ranks as the world’s second most common form of payment fell to 24.4% in July. Compared to the prior month, this is a 6.83 percentage point drop in the overall percentage.
There was a considerable increase in the proportion of transactions in dollars issued by the United States, eventually reaching 46.4%. In addition, the proportion of overseas deals finalised in the Chinese yuan climbed above 3 per cent, marking the highest level seen since the beginning of 2022. The significance of the yuan in international trade has been steadily increasing, which is in line with the strategic efforts that Beijing is making to increase the adoption of its currency worldwide.
SWIFT is still the most widely used mechanism for managing international payments transactions. On the other hand, in the banking industry in recent years, there has been a rise in the development of alternative communication channels.
