The Chinese Renminbi (RMB) has confirmed its position as the world's second most used currency in letters of credit (L/Cs).

A year ago RMB squeezed the euro out of the number two position.

Dollar domination

According to data released in late February by SWIFT, RMB activity share for L/C transactions rose to 9.43 per cent in January 2015.

Use of RMB in L/Cs has risen from 7.32 per cent in January 2013, but remains way behind the US dollar in which 80 per cent of L/C transactions are denominated.

However, the US dollar's role is being gradually eroded, with it losing around 3 per cent over the last two years.

Euro steady

The euro's share remains substantially the same at 6.45 per cent compared with 6.43 per cent in January 2013.

The Chinese currency now ranks fifth behind the Japanese yen amongst currencies used for global payments according to the new SWIFT data.

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