Use of the Chinese yuan in Germany and the U.K. has more than doubled over the last year, as London and Frankfurt fight to become the go-to place for trading the currency in Europe.
Yuan payments in the U.K. and Germany surged 123.6 percent and 116.0 percent respectively in the year to July 2014, according to new data from Swift, a financial messaging service.
“Over the past year, Chinese authorities and financial institutions announced new partnerships with European countries, making them official clearing centres for the renminbi (RMB). These announcements have boosted the RMB trading activities in these countries,” said Michael Moon, head of payments and RMB for Asia Pacific at Swift, in a press release.
Renminbi is the official name of the Chinese currency. Yuan is the name of one unit of the renminbi currency.
China is working hard to establish the yuan as a key currency for international trade, while keeping it under relatively tight control. In recent years, the government has struck major foreign-exchange swap deals—agreements to exchange one currency for another at a set rate at a certain time in the future—including with the euro zone, the U.K. and latterly, Switzerland.
“Announced in July, the bilateral currency swap agreement between the People’s Bank of China and the Swiss National Bank could put Switzerland in line to become a new RMB hub in Europe,” said Moon.