Why won't the Chinese yuan become the world's reserve currency?
China, the largest light oil importer, is completing preparations for the launch of naphtha futures denominated in yuan on the Shanghai Exchange. It is expected that exchange trading in futures will open up sooner or later. Tell Reuters about it. Tse, softly seemingly, is an important podium.
Exchange trading in naphtha and derivatives for naphtha is carried out at the New York Commodity Exchange, London Oil Exchange and Dubai Commodity Exchange. All 3 exchanges belong to one group – CME group. Plus, there is the ICE exchange, which also trades futures for naphtha. I think that ICE and CME have the same vlasniki. Tsі trade maidanchiki manipulate the price of naphtha, if you want - you want nafta cost 200 dollars, or 30 dollars at the same time. As if the country is an exporter of oil, if you want to organize your own oil exchange, then the same thing that happened to Iran will become it. That is why the world does not have more oil in the country. In 2005, the fate of Iran, violating the creation of the naphtha exchange, but the UN Security Council unanimously imposed sanctions against Iran and blocked the country's borders to buy naphtha in Iran. So sleepy.
The above reason for the organization of trading in futures for naphtha in China is the cause of wine importance. And there is one more reason why it is important. On the right, the Chinese have already organized trading in yuan-denominated gold futures (from Thursday 2016 in Shanghai and June 2017 in Hong Kong), and now they are trading naphtha futures denominated in yuan. Tse means 2 fundamental speeches:
[b]1. Now the price of naphtha in yuan will appear and, obviously, it will be possible to put contracts for naphtha in yuan.
[b]2. Now a company that sells naphtha or other goods for yuan under a long-term contract can immediately buy futures for gold for that sum of money under the agreed contract, so that they won’t be able to sell naphtha (or goods). Tobto. weide sho yuan security gold.
Until now, there was only one country, which allowed such a rite to protect the trade in the currency exchanges - the United States. There will be two such countries. Ale, China will have a win. On the right, in New York (London) it is impossible to buy physical gold, only futures for gold, which seem to be not the same. You can buy physical gold on the Shanghai Stock Exchange. In order to organize a liquid physical gold market in China and buy Rest of the Rocks gold at the Kіnsk obsyagas. Now China has 20,000 tons of gold (div. diagram).
For reparation, the United States - 8,000 tons, Nimechchini - 3,400 tons.
In other words, in the nearest future, if the exchange trade in naphtha and gold from Shanghai will be brought to full strength, in 1971 the world will have a currency backed by gold - the yuan. The yuan will not be tied to gold (like a dollar in its time), but it will be secure. Tobto. If it were a trading partner for China, it would be possible to buy physical gold for the yuan at the exchange price. So it looks like a new gold standard.
Exchange trade in naphtha in China changes everything. Light will not be much more. Exporters of oil (gas) can often convert their gold and foreign exchange reserves into yuan. Obviously, this is how to destroy Russia, Venezuela, Qatar, Angola. Iran is already so dead. The Saudis can't go anywhere if they want China to buy their naphtha. As we wrote in the previous post, China zhorst zmushu sauditiv to transfer contracts for naphtha in yuan. If it becomes (but it will), the Saudis will not feel comfortable changing yuan for dollars. The stench is so folded up at the gates at the sight of yuans.
I think that in the next 10-15 years a significant part of the light trade will be translated into yuan. The Chinese are planning to organize exchange trading in yuan not only for naphtha, but also for gas, copper and other colors of metal. Nominating trade contracts in yuan will be significantly better than in dollars, because the United States has a weak trade balance, and China has problems. That is why China has a bigger and more diversified economy.
Now you can forget not only about the US dollar, but also about the USA itself. Because the main article for US exports is dollars. Tomorrow the stench will not be needed by anyone in such an agreement, as it is today, and a dirka in the balance of payments of the United States has been registered. It will not lead to the collapse of the economy, but the dollar has fallen in price by 25%. We wrote a report here. Obviously, prices for all manufactured goods in the USA will increase by 25% and the population will not be captured. The United States has already entered a period of political instability and the situation has become less degrading.
Why spend the USA on the opportunity to steal dollars? Don't spend, but don't waste money. Vlasne, don't stink at them. Why waste the USA's ability to build up the sovereign borg? Hi, don’t spend, but yogo (borg) will be no longer a resident of the Fed. For foreigners, bonds of the US Treasury will not become more like citizens.
Light changes just before our eyes. China (with our help) is slaughtering the rest of the flowers at the top of the global financial system. The people are calling for a new order of the world. The United States gives way to the new world leader, China, just like 100 years ago, Great Britain gave up the life of the global leader of the United States. (Britain itself, before the speech, to pass from the rank of leaders is not another, but the third plan). The United States is left to work hard for global leadership and retire. We have more than one foe left - Nіmechchina. But the enemy is old and already careless.
The Chinese yuan was included in the special rights of the reserve (SDR). Tse means that the currency of the Middle Kingdom will officially become a luminous reserve asset, which is introduced in the middle of the International Monetary Fund (IMF) in the order of the dollar, euro, British pound sterling and Japanese yen.
Yak said the head of the IMF, Christine Lagarde, make a decision on the day of chivalry on the 1st of July 2016. We will give the SDR yuan 10.9 thousand yuan, so it will be in the third month after the dollar (41.73 thousand) and the euro (30.93 thousand). Top-5 close the pound sterling with a frequent 8.09 dollars and Japanese yen (8.33 dollars).
"Rice Viconavcho for the sake of yuan at the SDR Koshik - Imported VIKHA for the HITH INTEGRICHICHICHIKO Yekoniki at the Svitov system. to the standards of the free victorious currency. The SDR box, which includes the yuan, better reflects the world economy."
If in 1969 the SDR was created, the IMF was convinced that the special rights to reserve would be a piece reserve payment order, which regulates the balance of payments of the skin region, the repayment for loans, seen by the international organization of the reserve, and the popov.
In the light of the world's reserve currency on July 1, 2016, the yuan, strictly seemingly, is not worth it. To tsgogo status yomu more happen to be mature, oskolki rozumіnnі ekspertnoї spіlnoti currency becomes svetovoyu, if її actively vykoristovuyut in transcordonnіy torіvlі that її part of the temple in the reserves of central banks. Another important point is the possibility of winning the currency during the financial crisis. Five "graves" have secured the status of a reserve currency for themselves, which may even double the SDR cat: the US dollar, the euro, the pound sterling, the yen and the Swiss franc.
For the SWIFT fools, for the remaining three years, the yuan became one of the most widely used currencies in the world. For example, in 2012, the rotation of the wines was on the 12th row after the frequency of the win when roses, then the same fate - already on the fourth mist. For the time being, the yuan does not compare with the frequency of settlements in dollars (44.8 thousand) and euro (27.2 thousand).
From the other side, in the currency of the Middle Kingdom, there is a road to more significant peaks. Zastovpivshi behind him in the SDR bag, you can invest in those that the world's central banks are actively stinging yuan, and investors - investing in the stock market of China. Vіn mozhe add at least a trillion dollars to the vаіnіmіm mіnіmіm іnіmіm dоlarіv zavdjaki іѕnyu IMF, vvazhayut іn Standard Chartered.
Morgan Stanley went even further: the bank checks for an injection into the assets of the PRC for two trillion dollars, and the investment company AllianceBernstein to increase the rate for three trillion dollars in a long-term perspective. But to say in a singsong voice, analytics do not take into account the amount of the addressee's statements: access to Chinese shares for foreign investors with quotas.
Have any kind of vipadku, checks for a moment, if the yuan becomes a light reserve currency, it is not worth it. Associate Professor of the Faculty of Finance and Banking of the RANEPA Vasil Yakimkin is aware that the currency of the Middle Kingdom is within the reach of the declared value in the period from 2017 to 2022, having looked up for the show with the Japanese yen.
The IMF included the yuan against the key international reserve currencies, confirming its commitment to the prospects of a different world economy and increasing the possibility for further internationalization of the Chinese currency
Director of the International Monetary Fund (IMF) Christine Lagarde and two dozen members of the IMF for the sake of the fund at a meeting in Washington on Monday included a greater vote of the Chinese yuan against the key international currencies, on the basis of which the IMF special rights reserve (SDR) is secured. In this manner, the yuan has come to the prestigious club of the US dollar, the euro, and the pound sterling, yak utvoryuyut piece reserve and payment zasib, creations of the IMF in 1969 roci. The structure of the SDR cat is reviewed for five years.
The decision of the IMF is gaining chivalry in the future of 2016. The yuan will become the third currency after the vaga in koshiku (10.92%), having shortened the most part of the euro (after the inclusion of the new currency, yogo vaga becomes 30.93% against 37.4% to the second). The largest part of the dollar savings - 41.73%. Parts of one pound become 8.33 and 8.09% of the total. Before the inclusion of the yuan, the share of the dollar in the SDR was 41.9%, the pound sterling - 11.3%, and the yuan - 9.4%.
Access according to criteria
In the middle of the Lagarde leaf fall, that expert recommended that the fund include the yuan before the pool of reserve currencies. They explained their position to them that the yuan meets two criteria for the fund. First, play a significant role of international trade; in a different way, vydpovidaє "criteria of a free animal". In other words, the yuan can be widely victorious in international transactions, actively traded on the largest foreign exchange markets, but be represented in official foreign exchange reserves and international banking goiters. Remain - satisfied with the firmness, appoint deacons of authoritative economy.
Behind a number of indications that reflect the scale of the global renminbi renminbi, such as the renminbi's bidding by central banks as a reserve currency, as well as some positions on the borgo markets, the Chinese currency is transferred to the Australian and Canadian dollars, as it does not enter the SDR cat.
So, with a glance at the IMF, the list of the most requested reserve currencies is awarded four times a day for SDRs and for these currencies. At the same time, the share of the yuan in the structure of international official reserves became less than 1.1% against 63.7% in the US dollar. In addition, the yuan has not increased to five world currencies, as they are the most active in the currency trading markets.
Internationalization of the yuan
The share of the yuan in international payments (for the number of transactions) accounted for 2.79% (against 2.34% for the linden), which allowed it to surpass the Japanese yen for the first time in history, showing from the data of the SWIFT interbank transmission system. Thus, the Chinese currency has become the fourth in the top world's largest currencies behind the big moon bags, giving up the US dollar, the euro and the pound sterling.
Preparing to vote with the IMF, China has made a low entry to secure the renminbi's viability "to the criterion of free will." Thus, Beijing opened access to the domestic currency market and the bond market for foreign central banks, promoting the role of the remaining designated trading range of its currency. Alecia come in only recently, and the stench has not yet undergone a serious revision.
Critics of the IMF decision, such as Edwin Truman, a large-scale spokesman for the US Treasury Department, and one of the analysts at the Peterson Institute of Light Economics (Washington), argue that the fund is good for a series of deeds to China in the rest of the month for a good cause SDR out of Beijing. The stench appeared to be especially relevant in the light of China's dissatisfaction with the situation due to the reorganization of the quota system and votes in the fund. In 2010, reforms were blocked by the US Congress, which, as a result, prompted China to start creating institutions that would be alternative to the IMF and the World Bank. According to Truman, the value of the yuan exchange rate cannot be called sufficient for the inclusion of the Chinese currency to the SDR basket.
Politicized decision
"The [IMF] had a chance to meet its own criteria," Truman said about the IMF. Behind the words of Yeswar Prasad, the head of the Chinese head of the IMF apparatus, it was said about the inclusion of any foreign currency in the SDR box, the fund did not praise the positive decision. “It’s quite obvious that the IMF’s counterfeiters have jumped into the rules, instead of changing them,” says Prasad. - If you lie, if the IMF will demand China, the stench is not a very special choice.
China is the world's largest economy beyond purchasing power parity and without any recognition of international significance. economic system the global legitimacy of the IMF would be incomprehensible. The inclusion of the yuan before the SDR basket is a highly politicized decision, the FT told the FT about foreign diplomats in Beijing. Behind their words, Rest hour Beijing has already effectively passed the decision, without interfering with it, chi substantiates the yuan to the criteria necessary for inclusion in the SDR box.
However, the IMF's curiosity is blatant, that looking at the stock of the currency stock is simply a technical procedure, as it reflects such practical aspects, as the use of the yuan in transactions between members of the fund. "Who doesn't have any good politics," the FT told the high-ranking fund on the minds of anonymity.
The decision is to compare the fund's importance with the prospects of another world economy, as a result of which the status of its national currency and the expansion of the competition among international financial institutions. Officials of the IMF's largest shareholders are arguing that one of China's efforts to get the yuan up to the cat's SDR has resulted in the implementation of a series of large-scale transformations. The stench marked the positions of the Chinese reformers and fixed significant structural changes.
However, the Chinese reporters of Reuters are concerned that the IMF's decision is given to Chinese conservatives in the economy to push ahead with further significant reforms, relying on China's accession to the COT. Boosting the Chinese economy to hit on those who today believe that the inclusion of the yuan in the SDR box, on the other hand, give it an impulse. On the cob, the yuan weakened to the dollar by 3%, and it could show the biggest drop since 2005, if the PRC was forced to peg its currency to the dollar.
Dodatkovі mind
The IMF, for all intents and purposes, is to get China to take a step further to smooth out the process of including the yuan in the SDR, Domenico Lombardi, director of the economic programs International Center for Global Governance near Waterloo (Ontario). More than anything, the IMF will seek additional guarantees for the availability of the yuan exchange rate and tying it up to the new hundredth rate.
The IMF can also try to get the Central Bank of the People's Republic of China to take measures against foreign exchange interventions in order to make the decision on the inclusion of the yuan into the SDR basket more acceptable for other countries. "Use the membership in the IMF to be superb for the fact that in China there is control over the circulation of capital, but we are the key to the nutrition of the goiter, like taking the wines of the Central Bank of the People's Republic of China," Lombardy explains.
What is SDR
SDR - piece reserve and payment zasib, creations of the IMF in 1969 as an addition to the main reserve assets of the countries - members of the fund. The skin of them may have the right to win over the currencies of the koshika to regulate the balance of payments, cover the deficit of the balance of payments, increase reserves, and repay loans from the IMF.
Vikonavcha Rada, as it appoints a policy and vouches for the most decisions, consists of 24 vikonavchih directors, which are appointed by eight countries with the largest quotas for the fund - the USA, Japan, Germany, France, Great Britain, China, and Russia Saudi Arabia. The rest of the 176 countries are represented by 16 groups, skin of which they choose the chief director.
Vikonavcha is glad to sit over 200 times on the river, make a decision on the basis of consensus, and not a formal vote. Mark Sobel, Vice Director of the USA, Presidential Administration of Obama, for the most valuable of the members for the sake of (the US quota gives the region 17% of the votes with a well-deserved decision within the framework of the fund). G7 quotas give them a total of 43% of votes, while China's quota gives the country only 3.8% of votes.
Slip the yuan from the USA
On Monday, 30th leaf fall, the United States has created a working group, as a pracyuvatime over it, so that American companies are less able to pay rent and accept payments in yuan, write to the WSJ with a message to Bloomberg LP's manager Michael Bloomberg, who has become the head of the group. This initiative was called to reduce transaction costs and to accept the exchange of trade and business links from China.
Representatives of advancing companies and structures have moved up to the working group: US Treasury, Bank of America Corp., Bank of New York Mellon Corp., Citigroup Inc., Goldman Sachs Group Inc., JP Morgan Chase & Co., Morgan Stanley, Wells Fargo & Co., Agricultural Bank of China Ltd., Bank of China Ltd., Bank of Communications Co., China Construction Bank Corp. and Industrial & Commercial Bank of China Ltd.
For example, leaf fall 2015 Rada of IMF directors decided to include the Chinese yuan in reserve currencies. Behind the words of the director-manager of the Foundation, Christine Lagarde, is a recognition of the progress that the Chinese government has achieved in the remaining years of reforming the currency and financial systems of the country. Decision on the future of chivalry 1 August 2016
Apparently, until the end of the day, the US dollar, the euro, the British pound sterling and the Japanese yen were victorious as the reserve currency of the Special Positioning Rights (SDR). According to the IMF announcement, the yuan is deducted into foreign currencies a fraction of 10.92%, to move a fraction of the British pound - 8.09%, and a fraction of the Japanese ren - 8.33%. Part of the US dollar, regardless of the decrease, will lose the most - 41.73%, part of the euro becomes 30.93%.
The Chinese yuan is already valued by the rest of the world as a "free currency", the shards are stagnant in retail stores all over the world. According to the interbank information transfer system SWIFT, until the end of summer 2015. The part of the yuan in international sales rose to 2.79% and, in such a way, following this indicator of wines, the Japanese yen was in the first place. In 2010 under the hour of the rest of the review of the IMF's stock of currencies, moving Beijing from the inclusion of the yuan to a prestigious exchange, arguing that the Chinese currency at that time did not support the free choice. For the rest of five years, the yuan has made an adverse progress like a rozrahun currency, having moved from the 35th month to the example of 2010. on p'yat 2015 With tsomu in the Asia-Pacific region, with rozrahunka vin becoming the most widely used currency.
Preparing for the IMF vote, China has gained access to the domestic foreign exchange market and the bond market for foreign central banks, and the role of the Bank of China has been strengthened in the designated trade corridor for the yuan. However, come in, as if you were living in order to ensure the viability of the yuan to the “criteria of a free animal”, you can still go through the check for an hour.
The decision about the inclusion of the yuan before the SDR currency rate called out different estimates from light analysts. Nobody can deny the obvious successes of the Middle Kingdom for the rest of the decade, as it became a serious competitor to the leading light economies, and in 2010. vyishla in the first place in the world for the export of goods. At the same time, at the same time, the world of economic growth of the Chinese economy is creating problems for financial and syrovinnyh markets. As soon as possible, the improvement of the Chinese economy will continue, it’s easy to argue that the inclusion of the yuan in the warehouse of the SDR will give a positive impulse.
As having declared following the historic decision of the IMF, the protector of the People's Bank of the People's Republic of China I Gan, the country is ready to face possible risks, which may appear after the inclusion of the yuan to a cat of world currencies, and to reduce the stable exchange rate of the yuan. Decide what to do about serious goiter treatment. So, the IMF can help in Beijing to suvoruvatsya in the form of foreign exchange interventions, as well as to control the flow of capital.
Unprecedented swedish economic growth for China and the growing yuan in international markets, however, is not enough to include the national currency up to the SDR cat.
It appeared that behind a number of indications, as, for example, the central banks of the powers as a reserve currency, or as a reserve for positioning on the capital markets, the Chinese yuan is transferred to the Canadian and Australian dollars, as it does not enter the Fund up to the cat of currencies. For the rest of the IMF tribute, the share of the yuan in the structure of international foreign exchange reserves became less than 1.1%, while the share of the US dollar became 63.7%. In addition, the yuan is considered to be one of the other reserve currencies, which will be left for the time being with a single reserve currency with a fixed exchange rate. The yuan cannot be sold and bought freely. Lesser 2020 r. Chinese national currency can be freely converted. Experts seem to think that it was not about the Chinese yuan, but about the currency of another country, that the Fund would not have been able to take such actions.
It remains to suggest that the IMF is pishov on the turmoil of China and that the same decision about the inclusion of the yuan to the cat of currencies has been politicized. Such a thought was raised, zokrema, by representatives of the authoritative Peterson Institute of Light Economics in Washington. These actions could be smart enough to smooth out Beijing's dissatisfaction with the situation that has evolved with the IMF's redistribution of votes and quotas.
As you can see, zgіdno with the decisions of the IMF in 2010. the quota of the BRIK countries at the Fund increased from 10.71% to 14.18%, apparently the share of China and Russia increased. However, the reforms of the IMF were blocked by the US Congress. Tse, at its best, prompted Beijing to take up the creation of alternative monetary and financial institutions, which is not necessary for the current financial system, as the United States controls the significant world.
However, in the light of the IMF’s work, the currency reform is no more than a technical procedure, but it reflects such obvious realities as the renminbi’s exchange in transactional transactions between members of the Fund. At the same time, the position of the IMF, insanely, testifies to its importance in the prospects of the Chinese economy, as the rest of the fates are already “going wild at the back” of the American one. For the big day, the IMF could not include the currency of another world economy up to the honorable list of SDR currencies, which are valuable for saving the Fund's global legitimacy.
1. Special Drawing Rights (SDR) were founded as the currency of the IMF in 1969. based on the current set of reserve currencies.
On July 1, 2016, the world began to officially start not chotiri, as the rest of the second decade, but five reserve currencies: to the American, European, British and Japanese, the Chinese arrived. So virishila glad directors of the International Monetary Fund (IMF). On the 30th of the fall of 2015, the fate of the wines satisfied the application of Beijing and praised in ten months to include the penny unit of the PRC, the yuan, in its currency koshik. The won was created in 1969 for the purpose of assigning the rate of a mental untrained payment unit - special deposit rights (SDR).
Third place that part of 11 vіdsotkіv
There were 16 currencies in each koshik, and in 1981 the roci їх kіlkіst was shortened to five major ones: the US dollar, the German mark, the French franc, the British pound and the Japanese currency.
In 2000, after the introduction of the European penny unit, the mark and the franc were replaced by the euro. The first axis is now stronger in the history of the IMF until the exclusive club has accepted a new member in principle.
With the same yuan, once taking a third for the value of the place, otrimavshi 11% mayzha. The dollar lost about 40% on the equals, while the euro axis fell from 37% to 31%. Professor Rolf Langhammer (Rolf Langhammer), the largest vice-president of the Institute of Light Economics in Kiel (IfW), considers such a distribution to be completely true: "The value of the euro in international roses is shortening, the oscillating wines are no longer so dominant in international trade."
The director of the Hamburg Institute of Light Economics (HWWI), Professor Henning Vöpel (Henning Vöpel) is aware that the reduction of the share in the IMF cat by the value of the European currency: currency, and the value of euros is equal to the euro vantage.” In other words, the global economy will be able to shorten the euro in order to accept a depreciation of the exchange rate and give additional impulses to European exports.
Way to free conversion may take 10-15 years
At the same time, the global will drink on the yuan. So, wine, maybe, borrow the most money from the foreign exchange reserves of rich central banks around the world, wanting to stench is not guilty of repeating the structure of the IMF cat. Meanwhile, Professor Rolf Langhammer urges not to forget clearly the specifics of the penny unit of the PRC: "At some other currencies - the dollar, the euro, the pound and the euro - floating exchange rates. Stinks are not supported by sovereign interventions."
Well, the Chinese government is easing its penny loneliness in dosit zhorstkom currency corridor, until then, they are out of the way of capital. Therefore, the yuan cannot be put into the right sense of the word with a currency that can be freely converted.
Context
Prote Professor Hennig Fepel in respect of the IMF's decision is true: "From one side, it looks like China's growth for the real economy, which continues to grow, and from the other side, such a form of eagerness called to suffocate China on the far side of the country's foreign currency conversion."
In this hour, the government of the PRC is individually lowering the exchange rate of the yuan in order to stimulate exports, however, in China’s long-term plan, there are restrictions on the floating exchange rate, Henning Fepel: The growth rate of the yuan will help to promote such an economic model." Truthfully, the transition to the daily market formation of the course can be borrowed from China from 10 to 15 years, the director of HWWI.
Rolf Langhamer is skeptical about the prospects of the yuan as a reserve currency. "Accepting the decision to keep your reserves in this or that foreign currency, you will try to secure yourself in the form of possible exchange rates in other penny singles. If you can't reach the price with such a currency, like the yuan, even if the exchange rate is up to the currency rate, the most important place in which to borrow the dollar is, - guessing the amount of IfW vice-president.
