Share of international and foreign currency banking claims and liabilities
Left chart:
Stacked bar chart showing the currency breakdown of international and foreign currency banking claims from 2000 to 2020. The dominant share has been of the U.S. dollar, which is fairly stable around 50-60%. The second-largest share is the euro at around 20-25%. The remaining roughly 20% share is split between the British pound, the Japanese yen and “other” (which includes the Chinese yuan).
Right chart:
Stacked bar chart showing the currency breakdown of international and foreign currency banking liabilities from 2000 to 2020. The dominant share has been of the U.S. dollar, which is fairly stable around 50-60%. The second-largest share is the euro at around 20-25%. The remaining roughly 20% share is split between the British pound, the Japanese yen and “other” (which includes the Chinese yuan).
Sources: U.S. Federal Reserve, Bank for International Settlements and Wells Fargo Investment Institute. Annual data from January 1, 2000 to December 31, 2020. Data shows share of banking claims and liabilities across national borders or denominated in a foreign currency, excludes intra-euro area international liabilities and claims, and is at current exchange rates.
Key Takeaways
- Moves to denominate some trade transactions in Chinese yuan and other non-U.S.-dollar currencies have led to a surge in reports about “de-dollarization” and the loss of the U.S. currency’s dominant role in global finance.
- The U.S. dollar’s leading share in global banking and trade, backed by the rule of law and robust institutions, cannot easily be replaced.