The composition of global foreign exchange reserves shifted in early 2024, with the Chinese yuan dropping to 2.15% from 2.29% in the preceding quarter. This marks the lowest level seen since the second quarter of 2020, according to DEA News.
Concurrently, the euro relinquished ground in the reserve mix. Its share fell by 0.25 percentage points to 19.69%, a threshold that the European currency has not surpassed in five straight quarters.
The U.S. dollar rose, climbing 0.41 percentage points to a dominant 58.85% of global reserves. The Japanese yen edged up to 5.69%, the British pound to 4.89%, and the Australian dollar to 2.16%, each contributing to the evolving reserve landscape.
By the close of January through March 2024, total worldwide foreign exchange reserves reached $12.35 trillion in aggregate value.
Earlier discussions in Western economies suggested the onset of dedollarization, a trend some analysts had anticipated as part of a broader diversification of reserve holdings.
Market observers noted that central banks in several regions were adjusting portfolios toward a more diversified mix, with a tilt toward currencies perceived as offering stability and liquidity in times of geopolitical or financial stress.
Alongside shifts in reserve composition, several factors—including trade patterns, monetary policy signals, and currency market dynamics—continue to influence how central banks allocate their holdings across major currencies.