Sunset of US Dollar: Desired or Valid?

Professor Katasonov about the fate of the “American” in Russia and in the world. Part 1

Our media the latest data of the organization SWIFT as a sensation gave, which, as you know, is engaged in information support for a significant part of all cash payments in the world. Payments are made in different currencies. SWIFT compiles on a regular basis statistics of payments in the context of major currencies. These statistics can be found in the monthly RMB Tracker. Monthly reporting and statistics on renminbi (RMB) progress towards becoming an international currency. ” The latest publication is dated the end of September 2018 and reflects the structure of payments that passed through the SWIFT system in August of this year.

The essence of the sensation is that the share of the main currency, the US dollar, is decreasing in payments, and the share of the second currency, the euro, is growing, and the gap between these two leading currencies is narrowing. Not to be unsubstantiated, I will give a statistical picture as of August 2018 and for comparison a picture for August 2016 (tab. 1). In it, I give a picture of the first ten currencies that have the largest shares for August of this year.

Tab. 1. Currency structure of all payments passing through the SWIFT system (share in% of the total value of payments in all currencies)

Currency  August 2016 August 2018

US Dollar  40.72             39.69

Euro           32.91              34.13

UK Pound  7.05                 6.88

Yen (Japan) 3.01                3.43

Chinese Yuan 1.94              2.12

Payments both domestic (between entities of the same jurisdiction) and international (between entities of different jurisdictions)

Source: RMB Tracker

Indeed, over the past two years, the share of the US dollar has decreased by 1.03 percentage points, while the share of the euro has increased by 1.22 percentage points over this period. The gap between the two currencies slightly decreased and amounted to 5.56 percentage points in August against the gap in August 2016, equal to 7.81 percentage points. For a little sensation. For those who over the years have been monitoring the dynamics of the share of currencies in world payments and calculations, it is well known that there are fluctuations in the values ​​of indicators in certain ranges. Enhancements are replaced by declines and then new promotions. As the temperature fluctuations of atmospheric air. No “temperature and climate catastrophes” in the world of currencies have yet happened. By the way, for the specified period of time, such currencies as the British pound sterling, the Canadian dollar, the Australian dollar, the Swiss franc slipped somewhat. At the same time, there was some strengthening of the positions of such currencies as the Japanese yen, the Chinese yuan, the Hong Kong dollar and the Singapore dollar.

The currency picture of payments for exclusively cross-border (international) payments will be somewhat different.Eexcluding payments between entities in the same jurisdiction.

Tab. 2. Currency structure of international payments passing through the SWIFT system (share in% of the total value of international payments in all currencies)

Currency  August 2016 August 2018

US Dollar  45.29             42.87

Euro           32.21             36.98

Yen (Japan) 4.38                 3.99

UK Pound   3.86                3.76

Chinese Yuan 1.32             1.26

Source: RMB Tracker

In the context of exclusively international payments, the share of the United States decreased by 2.42 percentage points, while the share of the euro increased by 4.77 percentage points. The gap between these currencies fell from 13.08 percentage points to 5.89. Again, no revolution has yet occurred. Together with the US dollar, the positions of such currencies as the yen, the British pound sterling, the Canadian dollar, the Australian dollar, the Singapore dollar, the Swiss franc weakened. Even the Chinese yuan sank a little. And only the Hong Kong dollar strengthened its position with the euro.

By the way, the Russian ruble has somewhat improved its position. He did not enter the top ten currencies, but hit the second.