Renminbi propels the growth of EME currency trading
Emerging market currencies now make up a record 29 percent of global foreign exchange trading, led by the Chinese renminbi (CNY) and Hong Kong dollar (HKD). The CNY is now the fifth most traded currency, with the USD/CNY pair ranking third globally. April 2025 saw heightened volatility, boosting trading by hedge funds and other firms. Most CNY trades are still against the US dollar, and market fragmentation from capital controls continues to affect liquidity.
What it examines
This report examines the rapid growth of emerging market currency trading, especially the Chinese renminbi (CNY) and Hong Kong dollar (HKD), using data from the BIS Triennial Central Bank Survey. It explores trading patterns, market participants, and the impact of volatility and capital controls on FX market dynamics.
What it concludes
The study highlights how CNY and HKD are driving global FX market growth, with increased activity from hedge funds and trading firms. Findings can help policymakers and market participants understand liquidity, market fragmentation, and the effects of capital controls, guiding future research and policy on emerging market currencies.
Evidence objects
Emerging market currencies now make up a record 29% of global FX turnover, with the Chinese renminbi (CNY) and Hong Kong dollar (HKD) leading the surge, according to BIS data.
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CNY has become the worlds fifth most traded currency, and the USD/CNY pair is now the third most traded globally, surpassing USD/GBP, driven by April 2025s exchange rate volatility.
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Despite rapid growth, most CNY trades are still against the USD, and FX trading in CNY relative to Chinas economic size remains low, with market fragmentation from capital controls affecting liquidity.
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This paper offers a timely, data-driven synthesis of the Renminbis and other EME currencies growing roles in global FX trading, leveraging recent BIS survey data. While it lacks novel methodologies or theoretical advances, its up-to-date market insights and regulatory analysis make it compelling for practitioners and researchers seeking current perspectives.
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Raw abstract and provenance
- … Emerging market currencies' collective share of global foreign exchange (FX) turnover rose to a new high of 29% in April 2025. This compares with 26% in April 2022 and …
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