So what?
The See of Peter traditionally is in Rome, not because the Church liked Latin, or because Latin was a “holy” language (considering it was the language of the executioners of Christ, and the language of the oppressors and executioners of many early Christians), but because Peter went there, and died there, and because the successors of Peter were there for a significant number of centuries. And without getting into the facts that there were patriarchs in various areas, and the Bishop of Rome was one of those, the ulitmate authority was recognized as those consecrated bishops who in succession became the Patriarch, and ultimately named the Pope, seated in Rome.
As Roman military expanded its control over larger and larger parts of the (roughly) western known world, Latin, being first the language of the military, and subsequently of commerce, spread rapidly, and eventually the Church moved from Greek, which had been the language of commerce, to Latin.
The Church, meanwhile, flourished in eastern areas over which the Roman empire had little or no control. As Latin was adopted by the Church, it became the official language, even as commerce turned more to area languages and Latin became less and less used. It is no stretch at all of common sense that Rome continued to use Latin as its official language, as Latin continued throughout the Roman rite, which had spread over a larger population than other Eastern rites; and Rome would continue to correspond with the other Eastern rites, using Latin as it did with correspondence within the Roman rite. However, the Eastern rites would translate the Latin correspondence into their own languages. In short, their liturgical language was effectively also the the language of the people, and over time, those liturgical languages may not have kept pace with the language of the populace, but remained their liturgical language.
As to Latin being the “holy” language, there are any number of people who promote that idea; but their foundation is at best suspect. It is the language of the Roman rite, which is both the language of the largest rite and the See of Peter; but it is no more nor less holy than any of the other liturgical languages. And not to make too fine a point of it, the move to the vernacular for liturgy in the Roman rite certainly does not support the issue of “holiness” of Latin.
People have all sorts of opinions, and many of those opinions are based far more on emotions than anything; and thus are not worth disputing.
No one I know of or have heard of has chronicled how Latin has fallen off within the upper divisions of the Roman rite, but I recollect John Paul 2 lamenting that Latin was being used less and less among the hierarchy (and the reference appeared to be specifically among the Curia and those in Rome involved with the Curia). So it should be no surprise that Italian may be taking over the day-to-day communications.