The US dollar has lost to the euro as the number one currency for global transactions for the first time in nearly eight years, said the Society for Worldwide Interbank Financial Telecommunications (SWIFT).
According to Bloomberg citing monthly SWIFT data, the last time the euro was in the number one spot was February 2013.
Data from SWIFT, which handles cross-border international payments for more than 11,000 financial institutions in 200 countries, showed the European Union’s single currency was the most used one last month. It was followed by the greenback, then the British pound, and the Japanese yen. In the fifth spot was the Canadian dollar, which has moved China’s yuan to sixth place.
Statistics showed that 37.8 percent of the SWIFT cash transfers were completed in euros in October, rising six percent from about a year ago and marking the highest level since February 2013. The use of the US dollar dropped to 37.64 percent, down 4.6 percentage points.
The US currency has weakened more than 11 percent from its March peak, based on a Bloomberg index that measures it against a basket of major peers. Analysts are predicting its valuation to drop further.
Still, the Bank of International Settlements (BIS) said in its June report that the US dollar remained a dominant force in international finance. According to BIS, “around 85 percent of all foreign exchange transactions occur against the US dollar. It is the world’s primary reserve currency, accounting for 61 percent of official foreign exchange reserves.”
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