Korea’s status in the global foreign currency markets has fallen. Its ranking in the global OTC derivatives markets has also taken steps downwards.
According to the “Bank of International Settlements (BIS) world foreign currency and OTC derivatives market research” report released on September 5, Korea’s foreign currency market average daily transaction volume for April was calculated to be US$47.5 billion.
This is 8.4% improvement over US$43.8 billion in April 2010, but compared to the global foreign currency market transaction volume in the same period, the growth rate is very slow.
While Korea’s foreign currency market transaction volume grew by 8.4% in the past three years, global foreign currency market transaction volume grew by approximately 35% (average daily transaction volume grew from US$3,971 billion to US$5,345 billion).
In effect, Korea’s part in the global foreign currency markets fell from 0.9% in 2010 to 0.7% in 2013. Korea’s ranking also fell from 13th place to 15th place.
On the other hand, England had the largest volume of the foreign currency market (40.9% of the world), followed by the United States (18.9%), Singapore (5.7%), Japan (5.6%), and Hong Kong (4.1%). Among the currencies, American dollars had the highest frequency of transaction at 87.0%, followed by euros (33.4%), Japanese yen (23.0%), British pounds (11.8%), and Australian dollars (8.6%). Chinese yuan recorded 2.2%, jumping from 17th place to 9th.
The Wall Street Journal (WSJ) focused on the fact that this is the first time the Chinese yuan entered the list of top ten most frequently traded currencies. Approximately US$5.3 trillion (5,800 trillion won) of Chinese yuan is traded on an average day, ranking as the 9th most frequently traded currency in the world. Transaction volume has increased by approximately US$1.3 trillion in the past three years, and its ranking has also jumped by eight places. This is interpreted as the result of the Chinese government’s efforts to make the Chinese yuan a key currency, including expansion of offshore transactions.