On the Geographical Dispersion of Euro Currency Trading: An Analysis of the First 20 Years and a Comparison to the RMB

Abstract The Euro and the RMB are both relatively new currencies traded on global foreign exchange market. While was introduced in 2001, China started cross-border settlement 2009. We analyse evolution of trading based data from BIS triennial survey compare patterns to experience internationalization. find that—similar RMB—Euro displayed some convergence geographical pattern all first years its existence. Thereafter, process appears have come halt. document that determinants include links offshore centres, economic institutional characteristics, but these turn out be rather unstable over time. RMB, comparison, displays a clear is more strongly influenced by policies recent trade disputes. Furthermore, we dispersion previous D-Mark period other commonly used international currencies. These results help interpret evidence initial as rebound effect decline use during 1990s.