Civil Evolution of the RMB Internationalization
CEIC China Data Talk - October 28, 2015 Renminbi internationalization is not just national policy. It is also perceived as China’s image, the public’s confidence, as well as the political consideration of the Chinese government. While the Chinese government has been promoting RMB internationalization vigorously, the Chinese people are simultaneously moving at an accelerated pace towards internationalization. This acceleration is very well demonstrated by the settlement of foreign exchange transactions among the foreign receipts of both the enterprises and the individuals, i.e. the settlement ratio. Now, let’s use two sets of data - banks’ collection of foreign currency receipts on behalf of enterprises and individuals, and foreign currency settlements to calculate the settlement ratio.
- The monthly average settlement ratio of enterprises and individuals’ foreign currency receipts is around 71% between the period of January 2014 to June 2015.
- Prior to the drastic move of RMB depreciation on August 11th, the settlement ratio had already fallen dramatically from 76.3% in June to 70% in July.