November 01, 2019
in Washington, DC.
The Islamic Republic boasts regularly that it has been remarkably successful in reducing the role of the US dollar in international trade by encouraging countries to use their own currencies, but new statistics show the dollar remains dominant.
Every third year, the Bank of International Settlements in Switzerland checks the foreign exchange transactions in the month of April to see what the preferred currencies are. This past April, the US dollar was involved in 88 percent of all such transactions. That was almost triple the volume of transactions using the euro and five times those using the Japanese yen.
The table shows the results since the euro was first developed in 1999. There has been some shifting up and down each time the survey was done. But there is no major shift at all in the last two decades.
Iran has been pushing for the Chinese yuan. It was in eighth place this year and used in 4 percent of all transactions. Its limited role, despite China now being the world’s second largest economy, suggests skepticism about the tight control the Chinese government exerts over its currency.
Note that the total for all transactions comes to 200 percent because there are two sides to each foreign exchange transaction. No country can, therefore, be involved in more than 100 percent of all transactions.