Exporters Ditch Dollar Amid 9% Yearly Drop, Seek Euro, Yuan

Foreign exporters are reportedly less interested in being paid in US dollars due to the currency’s recent volatility. This shift is driven by the dollar's price movement, with exporters seeking to limit their exposure to its fluctuations. Paula Comings, head of FX sales at a major bank, noted that American importers have been receiving requests from their foreign export partners to be paid in euros, Chinese renminbi, Mexican pesos, and Canadian dollars. This trend indicates a growing reluctance among exporters to be exposed to the dollar's price fluctuations.

Comings observed that the perception of the dollar as a sacred currency among suppliers has diminished. Exporters are now more inclined to demand payment in their local currencies, reflecting a broader shift in global trade dynamics. For example, a lumber company from the Midwest has started using euros to purchase hardwood imports from Europe, while a homeware retailer plans to pay for imports from China with yuan. Both companies previously used dollars for these transactions.

The US Dollar Index is currently trading at 98.92, marking a 5% increase over the past five days but a nearly 9% decrease year to date. This volatility has likely contributed to the growing preference for alternative currencies among foreign exporters. The bank, with total assets of $659.191 billion as of March 31st, 2025, is well-positioned to observe and respond to these trends in the global currency market. The shift away from the dollar underscores the importance of currency diversification in international trade, as exporters seek to mitigate risks associated with the dollar's volatility.