China devalues yuan
currency to three-year low
11 Aug 2015
China's central bank has devalued
the yuan to its lowest rate against the US dollar in almost three years. The
move, which makes exports cheaper, comes after weak economic data from the
world's second largest economy. Washington has in the past complained that
China uses its currency for competitive advantage. Senator Chuck Schumer: "For
years, China has rigged the rules and played games with its currency.'' "The
question on everyone's mind is whether this is the awakening of the dragon ushering
in a new global currency war?" Angus Nicholson, market analyst with
trading firm IG.
Brics countries
launch new development bank in Shanghai
21 Jul 2015
The Brics group of emerging
economies on Tuesday launched its New Development Bank (NDB) in Shanghai. The
bank is backed by Brazil, Russia, India, China and South Africa - collectively
known as Brics countries. The NDB will lend money to developing countries to help
finance infrastructure projects. The bank is seen as an alternative to the
World Bank and the International Monetary Fund. The biggest contributor will be
China, which also led the establishment of another new international bank, the
Beijing-based Asian Infrastructure Development Bank.
China-led AIIB
development bank holds signing ceremony
29 Jun 2015
China has hosted the signing
ceremony of the Asian Infrastructure Investment Bank (AIIB), a new
international financial institution set to rival the World Bank and Asian
Development Bank. Delegates from 50 countries signed articles that determine
each member's share and the bank's initial capital. The UK, Germany, Australia
and South Korea are among the founding members. Japan and the US, which oppose
the AIIB, are the most prominent countries not to join.
Australia to join
China-led AIIB as founding member
24 Jun 2015
Australia has said it will join a
China-led infrastructure bank as a founding member, contributing 930m
Australian dollars ($718.5m; £455m) over five years. The move will make
Australia the sixth biggest shareholder of the Asian Infrastructure Investment
Bank (AIIB). More than 50 members have signed up to the lender, which is widely
seen as a rival to the Western-led World Bank. The UK, France, Germany and Iran
are among its members. The US and Japan have refused to join, however.
Russia: Farmer's
'village currency' lands him in court
05 Jun 2015
A Russian farmer has ended up in
court after he began printing an alternative local currency for his village.
Mikhail Shlyapnikov says he created the "kolion" - named after the
village of Kolionovo, near Moscow - as a light-hearted form of IOU for barter trades
between farmers. The rate is fixed at five kolions for a bucket of potatoes.
But local prosecutors and the Russian Central Bank have taken him to court to
have the kolion declared illegal, saying it's a threat to Russia's sole legal
currency, the ruble.
IMF calls on China to
allow greater currency flexibility
07 May 2015
The International Monetary Fund
(IMF) has said China should continue to provide "greater flexibility"
in its exchange rate policy as the country continues to see slower growth. It
did not label the country as a currency manipulator, however, the US said further
appreciation was needed as the mainland continued to see productivity growth
greater than its major trading partners. It said the reforms were critical to
sustainable growth.
France and Germany
join UK in Asia bank membership
17 Mar 2015
France and Germany are to join the
UK in becoming members of a Chinese-led Asian development bank. Last week, the
US issued a rare rebuke to the UK over its decision to become a member of the
AIIB. The US considers the AIIB a rival to the Western-dominated World Bank. It
is believed Italy also intends to join. Some 21 nations came together last year
to sign a memorandum for the bank's establishment, including Singapore, India
and Thailand.
UK support for
China-backed Asia bank prompts US concern
13 Mar 2015
The US has expressed concern over
the UK's bid to become a founding member of a Chinese-backed development bank.
The UK is the first big Western economy to apply for membership of the Asian
Infrastructure Investment Bank (AIIB). The AIIB, which was created in October
by 21 countries, led by China, will fund Asian energy, transport and
infrastructure projects. The US sees the Chinese effort as a ploy to dilute US
control of the banking system, and has persuaded regional allies such as
Australia, South Korea and Japan to stay out of the bank.
Russia's credit
rating is cut to junk by S&P
26 Jan 2015
Russia’s credit rating has been cut
to junk – or below investment grade – by US ratings agency Standard and Poor’s
for the first time in a decade. S&P gave Russia a rating of BB+, which puts
it at the same level as Indonesia and Bulgaria. Russia’s economy is expected to
contract by 4% to 5% this year. The ruble dropped even further against the
dollar in the wake of the announcement, falling 7.5% in late trading in Moscow.
The currency has depreciated over 40% against the dollar in the past year.
Denmark acts over
fallout from Swiss currency turmoil
19 Jan 2015
Denmark has cut its key interest
rate in the wake of Switzerland's decision to scrap the franc's peg to the
euro. There has been speculation that Denmark could follow the Swiss move by
removing the krone's link to the euro. Denmark cut its deposit rate to minus
0.2% from minus 0.05%. The lending rate was cut from 0.2% to 0.05%. Denmark
first imposed negative rates in 2012, meaning that depositors effectively had
to pay to keep their money with the central bank.
Russian ruble falls
to new low against US dollar
15 Dec 2014
The Russian ruble has dropped to a
new low against the US dollar, as falling oil prices and Western sanctions
continue to weigh on the country. As of Monday afternoon, it takes more than 60
rubles to buy a single dollar. The 60 mark is considered a "psychological
barrier" for Russia's national currency. Since the start of the year, the
ruble has lost more than 45% of its value against the dollar. Russia's central
bank efforts have been overwhelmed by the fall in the price of crude oil.
ISIS announces new
currency
13 Nov 2014
ISIS is planning to mint its own
currency in gold, silver and copper, the group said Thursday. Its aim is to
stay away from the "tyrant's financial system," ISIS said in a
statement. The currency will include seven coins: two gold, three silver and
two copper. The move will remove Muslims from the "global economic system
that is based on satanic usury," ISIS said.
Russian ruble weakens
on debt downgrade
20 Oct 2014
The Russian ruble has weakened
further against the dollar following a downgrade of the country's debt rating
by the ratings agency Moody's. On Friday, Moody's cut its rating of Russian
debt to Baa2, its second-lowest investment grade. In a statement, Moody's said:
"The tightening of sanctions against Russia has already begun to aggravate
the slowdown in economic growth and to undermine consumer and investor
confidence in the country. Moody's expects growth to turn negative at the end
of this year and to continuing decline until "at least mid-2015".
Why is Britain
issuing debt denominated in renminbi?
09 Oct 2014
Britain is in the process of
issuing a government bond denominated in the Chinese renminbi (RMB), making it
the first country (aside from China, of course) in the world to do so. Britain
will use the proceeds to finance its reserves, which currently consists of only
US dollars, euros, yen and Canadian dollars, according to HM Treasury. The UK
isn't the first country to hold RMB in its reserves, as central banks largely
in emerging markets have also begun to do so. It is an important step on the
path toward the rise of the RMB as an internationally used currency.
China's President Xi
Jinping signs Venezuela oil deal
http://www.bbc.com/news/world-latin-america-28414623
21 Jul 2014
Chinese President
Xi Jinping has signed a series of oil and mineral deals with Venezuela. The
agreements came on the latest stop of a four-country visit to Latin America.
Mr. Xi has already signed key deals in Argentina and Brazil. He has now
departed from Venezuela and will visit Cuba next. In Argentina the Chinese
leader agreed to an $11bn currency swap providing much needed money for the government
of President Cristina Fernandez de Kirchner. Mr Xi also helped launch a new
development bank alongside the other emerging powers of the Brics group -
Brazil, Russia, India and South Africa - at a summit in Brazil. The new bank is
intended to create an alternative to the Western-dominated World Bank. Chinese
trade with Latin America has grown rapidly. It is now the second-largest
trading partner in Argentina and Cuba, and has been Brazil's largest since
2009. China is the second-largest market for Venezuelan oil after the United
States.
Brics nations to create
$100bn development bank
http://www.bbc.com/news/business-28317555
15 Jul 2014
The leaders of the
five Brics countries have signed a deal to create a new $100bn (£58.3bn)
development bank and emergency reserve fund. The Brics group is made up of
Brazil, Russia, India, China and South Africa. Despite their political and
economic differences, the one thing these countries do agree upon is that rich
countries have too much power in institutions like the World Bank and the IMF.
The creation of the Brics bank will almost surely create competition for both
the World Bank and other similar regional funds. Brics nations have criticized
the World Bank and the International Monetary Fund for not giving developing
nations enough voting rights.
China and Greece sign
deals worth $5bn during Li visit
21 Jun 2014
China and Greece have signed
business deals worth about $5bn (£2.9bn) during Chinese Premier Li Keqiang's
visit. Deals signed covered areas including exports and shipbuilding. China
also showed an interest in buying railways and building an airport in Crete. China
is eager to take a majority stake in the Piraeus port. A Chinese company
already runs two piers at the port. Greece is keen to attract foreign
investment to reduce its national debt and high unemployment rate. Not all
Greeks are delighted: the opposition says the government is selling the family
silver on the cheap.
Russia's credit
rating downgraded by S&P
25 Apr 2014
Credit ratings agency Standard
& Poor's has cut Russia's rating to one notch above "junk"
status. S&P said: "In our view, the tense geopolitical situation
between Russia and Ukraine could see additional significant outflows of both
foreign and domestic capital from the Russian economy." The agency said
this could "further undermine already weakening growth prospects".
The move comes as foreign investors continue to take money out of the country
amid tensions over the situation in Ukraine. Investors have been pulling money
out of Russia since last year when the country's economy ran into trouble, but
this process has intensified in recent weeks amid concerns over Ukraine.
US tells China it
must allow its currency to strengthen
15 Apr 2014
The US has told China its currency
must be allowed to rise if it and the global economy are to see stable growth.
The US Treasury's twice-yearly report to policymakers says the yuan is
"significantly undervalued". China had allowed the yuan - also known
as the renminbi - to rise, but the report said this had not gone far enough. It
also noted that "China has continued large-scale purchases of foreign exchange
in the first quarter of this year, despite having accumulated $3.8 trillion in
reserves, which are excessive by any measure."
Bank of England
agrees Chinese London currency clearing hub
26 Mar 2014
The Bank of England has agreed a
deal with the People's Bank of China to make London a hub for Chinese currency
dealing. 62% of yuan payments outside of China already take place in London.
Last year the UK and Chinese central banks signed a three-year currency swap
arrangement worth 200bn yuan which allows them to swap currencies and can be
used by firms to settle trade in local currencies rather than in US dollars.
Direct currency
trading begins with New Zealand
19 Mar 2014
China and New Zealand announced a
landmark deal on Tuesday that allows the direct trading of the two countries'
currencies. The deal, which takes effect on Wednesday, ends the need for
companies and currency traders to convert Chinese yuan or New Zealand dollars
into a third currency, usually US dollars, when making or receiving payments.
New Zealand's currency is the sixth to be granted direct-trade status, after
the US dollar, Japanese yen, Australian dollar, Russian ruble and Malaysian
ringgit.
Global markets steady
as Ukraine impact fears ease
04 Mar 2014
Russia threatened to abandon the US
dollar as the country's reserve currency. The IMF is currently in Ukraine to
assess the economy and begin negotiations over a potential bailout. The interim
Prime Minister, Arseny Yatsenyuk, has said Ukraine will accept whatever
conditions the IMF seeks. Kremlin
economic aid Sergei Glazyev said that if the US imposed sanctions, Russia would
figure out a way to use a new payment system that was not reliant on US dollars
for international transactions.
Russian ruble hits
new low against the dollar and euro
03 Mar 2014
Russia's ruble has fallen to a
fresh all-time low against both the dollar and the euro after the political
turmoil in Ukraine intensified. The ruble fell 2.5% to 36.5 rubles against the
dollar and 1.5% against the euro to 50.30.Stocks on Moscow's MICEX main stock
index also fell more than 11%. The G7 nations of Canada, France, Germany,
Italy, Japan, the UK and the US said they were ready "to provide strong
financial backing to Ukraine".
Luxembourg's
challenge to London over China's yuan
03 Mar 2014
The yuan, which is also known as
the renminbi, is not really available outside mainland China. But this is
changing. China is allowing more and more places to trade in its very tightly
controlled currency. Hong Kong, London and Singapore have each been given
quotas allowing banks based in these cities to trade in the currency. London,
Frankfurt, Paris and especially Luxembourg all want a large slice of the
growing Chinese currency pie.
Ukraine's failing
economy: Who is to blame?
10 Feb 2014
Ukraine's national currency, the
hryvnia, has plunged to its lowest official level against the US dollar since
its inception nearly 18 years ago. After weeks of intervention on the currency
markets in an attempt to keep the currency stable, Ukraine's Central Bank last
Thursday cut the exchange rate and imposed capital controls. Ukrainian
officials blame the devaluation of the national currency on the mass protests
and an economic slowdown in developing countries. Observers see the hryvnia's
fall as a natural result of several years of poor economic policy, a rising
trade and budget deficit, 18 months of recession and mounting foreign debt.
Wall Street slides on
currency woes
24 Jan 2014
Stocks on Wall Street fell sharply
on Friday as jitters in emerging markets spooked investors. In New York, the
Dow Jones fell 318.24 points, just shy of 2%. On Thursday, Argentina abandoned
efforts to defend the peso, and it fell 11% against the US dollar. Other
emerging market currencies have also fallen, and nerves spread to European stock
markets on Friday.
China and ECB sign
$57bn currency swap deal
11 Oct 2013
China and the European Central Bank
have signed a currency swap agreement worth 350bn yuan ($57bn; £36bn),
state-owned Xinhua news agency has said. Such agreements mean the central banks
can exchange currencies and firms can settle trade in local currencies rather
than in US dollars. The deal is one of the largest for China as it looks to
build a more international role for the yuan.
UK and China in £21bn
currency swap deal
23 Jun 2013
The Bank of England and its Chinese
counterpart have signed a deal likely to boost trade between the UK and China
in the yuan. The Bank and the People's Bank of China have signed a three-year
currency swap arrangement worth 200bn yuan (£21bn, $33bn). The UK is looking to
become a center for the Chinese currency. Currency-swap agreements allow firms
to settle trade in local currencies rather than in US dollars. Beijing has been
using these pacts as part of its push for a more global role for the yuan. It
has a swap agreement with Brazil worth $30bn and similar agreements with Japan,
Australia and Hong Kong.
US targets Iranian
currency with fresh sanctions
03 Jun 2013
The US has unveiled fresh sanctions
against Iran, targeting its currency, as it increases the pressure on Tehran to
abandon its nuclear program. These include penalties on anyone facilitating
"significant" transactions in the rial or holding significant amounts
of the currency outside Iran. A US official said the move would force
institutions to dump rial holdings and weaken the currency further. This is the
first time the US has directly targeted the Iranian currency.
China and Australia
in currency pact
09 Apr 2013
The move is seen as a significant
step in China's push for a more international role for its currency. Beijing is
trying to promote the yuan as an alternative to the US dollar's role as a
global reserve currency. China is the
biggest buyer of Australia's natural resources such as iron ore. But with no
mechanism in place to directly convert between the Australian dollar and the
Chinese yuan, the two countries have long used the US dollar as a trading
currency. Until now, companies had to first convert their respective home
currencies into the US dollar, before exchanging into the yuan or the
Australian dollar.
China and Brazil sign
$30bn currency swap agreement
26 Mar 2013
China and Brazil have signed a
currency swap deal. The pact, first announced last year, will allow their
central banks to swap local currencies worth up to 190bn yuan or 60bn reais
($30bn; £20bn). Along with being the world's second-largest economy, China is
also Brazil's biggest trading partner, driven by growing Chinese demand for
Brazil's resources, such as iron ore and soy products. China has been pushing
for a more international role for its currency, the yuan. It has been trying to
promote the yuan as an alternative to the US dollar as a global reserve
currency.
BOJ nominee Haruhiko
Kuroda promises to beat deflation
04 Mar 2013
Haruhiko Kuroda, nominated to be
the next head of Japan's central bank, has promised aggressive steps to raise
inflation to 2%, an aggressive ultra-easy monetary policy will pump more money
into the economy and also weaken the yen. Japan's economy has struggled with
deflation for many years, seen as a challenge to sustainable growth. The weaker
Japanese currency would boost exports and help spur economic growth. But there are
fears that a prolonged and deliberate weakening of the Japanese yen could spark
a currency war, if other countries that trade or compete with Japan were to
also take steps to devalue their currency, in order to gain a trade advantage.
UK and China poised
for currency swap deal
22 Feb 2013
The Bank of England is in
negotiations with its Chinese counterpart on a deal likely to boost trade
between the UK and China in the yuan. The UK is looking to become a center for
the Chinese currency, also known as the renminbi. Such agreements allow central
banks to swap currencies and can be used by firms to settle trade in local
currencies rather than in US dollars, as happens now, since China's currency is
not fully convertible to other currencies. China has been gradually relaxing
strict controls on the value of its currency and on flows of capital. It has a
swap agreement with Brazil worth $30bn and has also signed similar agreements
with other trading partners such as Japan, Australia and Hong Kong.
G20 leaked communiqué
doesn't single out Japan
15 Feb 2013
The weak yen gives Japan's
exporters a price advantage, raising fears of a "currency war" -
competitive devaluations by other big exporters. Industrialized economies such
as the US and eurozone have expressed unease that the weaker yen, which gives
Japan a competitive advantage, could be used as an excuse by other exporter
nations to intervene directly in the currency markets in order to weaken their
own currencies. Such "beggar-thy-neighbour" policies might leave
convertible currencies such as the dollar, euro and pound painfully overvalued.
Recent data showed that, like in Japan, the eurozone recession also deepened
more than expected in the final three months of 2012.
Yen jumps after G7
clarifies currency statement
12 Feb 2013
The yen has jumped against major
currencies after an official representing the G7 rich nations clarified a
statement it had made on the currency markets. This week the talk of "currency
wars" has been inflamed as France expressed concern at the strength of the
euro. Japan's Prime Minister - Shinzo Abe - has been trying to kick-start the
country's economy since being elected last December. He wants to get domestic
prices rising and has taken action to weaken the yen.
Venezuela devalues
currency by 32% against the dollar
08 Feb 2013
Venezuela has cut the value of its
currency against the US dollar by 32%, in an effort to boost its economy. This
is the fifth devaluation of the bolivar since Hugo Chavez' administration
started controlling the exchange rate, in 2003. Strict controls to prevent
currency going out of the country mean that dollars are normally hard to get in
Venezuela. Dollars have been trading at four times the official rate on the
black market. In a country that largely depends on food imports, the scarcity
of dollars also led to shortages of products such as sugar and flour.
Egypt foreign
currency reserves fall again
05 Feb 2013
Egypt's dwindling foreign currency
reserves fell 10% in January, according to the country's central bank. The bank
said reserves fell by $1.4bn during the month from $15bn to $13.6bn amid
continued political unrest and violent street protests. The figures again raise
concerns over the state of Egypt's economy and the government's finances. In
the last two weeks, violent protests have again erupted in Cairo and other
cities. Egypt is also in talks with the European Union over a $900m loan, along
with smaller loans from the US and the African Development Bank.
US says China not a
currency manipulator
27 Nov 2012
The US has decided not to declare
China as having manipulated its currency to gain an unfair trade advantage. But
the Treasury did say that China's currency, the yuan, remains
"significantly undervalued" and urged China to make further progress.
In its semi-annual report, it said Beijing did not meet the criteria to be
called a currency manipulator, which could have sparked US trade sanctions. The
issue of whether China manipulates its currency is an important political issue
and an ongoing source of tension between the world's two biggest economies.
Defeated US presidential candidate Mitt Romney had said he would have branded
China a currency manipulator on his first day in office.
Hong Kong weakens
local currency again
24 Oct 2012
Hong Kong's central bank has intervened
in financial markets again, weakening the value of its currency after it jumped
in value. Weak economic conditions in the US and Europe have prompted many
investors to look for better-performing assets in markets such as Hong Kong.
The bank said that it may have to keep intervening to keep its currency cheap.
Critics have argued that by being linked to the US dollar, Hong Kong's monetary
policy is heavily influenced by that of the US.
Third Presidential
Debate
22 Oct 2012
OBAMA
We then organized the strongest
coalition and the strongest sanctions against Iran in history, and it is
crippling their economy. Their currency
has dropped 80 percent.
ROMNEY
I’ve watched year in and year out
as companies have shut down and people have lost their jobs because China has
not played by the same rules, in part by holding down artificially the value of
their currency; it holds down the prices of their goods. That's why on day one
I will label them a currency manipulator.
You can't keep on holding down the value of your currency, stealing our
intellectual property, counterfeiting our products, selling them around the
world -- even into the United States.
Second Presidential
Debate
16 Oct 2012
ROMNEY
China has been a currency
manipulator for years and years and years. And the president has a regular
opportunity to label them as a currency manipulator but refuses to do so. On
day one, I will label China a currency manipulator.
OBAMA
And as far as currency
manipulation, the currency's actually gone up 11 percent since I've been
president because we have pushed them hard.
Iran police clash
with protesters over currency crisis
03 Oct 2012
Tear gas was used to disperse the
demonstrators, some of whom were setting fire to tires and rubbish bins.
Amateur video footage show hundreds of people marching towards Iran's central
bank. The rial has plummeted to record lows against the US dollar in recent days.
The government had closed the currency exchange shops, hoping to curtail the
turmoil. Hundreds of police are also reported to have rounded up and arrested
illegal moneychangers in the capital.
Iran rial: Mahmoud
Ahmadinejad blames slide on 'enemies'
02 Oct 2012
Iranian President Mahmoud
Ahmadinejad has blamed the "enemies" of his country for the sharp
falls in its currency, the rial. The currency has fallen to fresh record lows
against the US dollar. The rial plunged 18% in Monday's trading and then
another 9% on Tuesday. The rial has lost more than 80% of its value since 2011
because of US-led trade sanctions. US officials say the slide reflects the success
of US economic sanctions targeted at Iran's controversial nuclear program. Mr.
Ahmadinejad said Western sanctions amounted to an economic war. The US has also
threatened to take action against foreign firms and institutions dealing with
the Iranian central bank.
China proposes $10bn
loan for Latin America countries
26 Jun 2012
China has offered to set up a $10bn
(£6.4bn) credit line for Latin American countries to support infrastructure
projects in the region. They explained that Latin American nations could
benefit from Beijing's expertise, while Chinese firms may play a big role in
developments of these projects. Along with increased trade, Premier Wen also
pushed for currency swap agreements with the region's economies. The agreements
allow respective central banks to swap currencies and can be used by firms to
settle trade in local currencies rather than in US dollars. Beijing has been
using these pacts as part of its push for a more global role for its currency,
the yuan.
China and Brazil in
$30bn currency swap agreement
22 Jun 2012
China and Brazil have agreed a currency
swap deal in a bid to safeguard against any global financial crisis and
strengthen their trade ties. The agreement is the latest in a series of similar
deals signed by China with its trading partners. Analysts said that Beijing has
been trying to push for trade to be settled in yuan, rather than in US dollars,
as part of its plans to seek a more global role for its currency. "The
motivation is to be less reliant on the US dollar," Sean Callow, chief currency
strategist at Westpac, told the BBC.
Hong Kong debates its
currency's peg to the US dollar
20 Jun 2012
Over the past 30 years, Hong Kong's
currency has been pegged to the US dollar at a rate close to 7.8 - making $10
equal to HK$78. Prof Joseph Yam, the former head of the Hong Kong Monetary
Authority (HKMA), recently published a working paper suggesting a review of the
dollar peg. Hong Kong's top officials have all publicly announced their support
for the US dollar peg in response to the academic paper.
China and Japan to
start direct yen-yuan trade in June
28 May 2012
China will allow direct trading of
the yuan and the Japanese yen, in a move aimed at promoting trade between
Asia's two biggest economies. This means the two countries will not be using
the US dollar as an intermediary. China, which sometimes has a tense
relationship with Japan, is the country's biggest trading partner. This is the
first time China has let a major currency other than the US dollar trade
directly with the yuan.
China buying oil from
Iran with yuan
08 May 2012
China is buying crude oil from Iran
using its currency the yuan, an Iranian diplomat has said. Oil transactions are
usually settled in dollars but US sanctions make it difficult for Iran to
accept payments in the US currency. China is the biggest buyer of Iranian crude
oil exports. China has been providing the currency to Iran via Russian banks
rather than its own domestic banks.
Timothy Geithner
calls for China to alter growth policy
02 May 2012
US Treasury Secretary Timothy
Geithner has urged China to change its export-led growth policy and focus on
increasing domestic consumption. Mr. Geithner also called for China to allow
further appreciation of its currency. US policymakers argue that it is still
undervalued.
HSBC to raise money
in Chinese currency in London
18 Apr 2012
HSBC is to raise money in London in
the Chinese currency, becoming the first business to issue a benchmark bond
outside mainland China or Hong Kong. Chancellor George Osborne has said it is a
step towards London being the top Western trading hub in the yuan, also called
the renminbi. China is taking steps to make the yuan a global, convertible currency.
China eyes freer
financial markets to boost yuan role
04 Apr 2012
China is looking to increase
investment and competition in its financial and banking sectors. The shift may
boost growth and create a more international Chinese currency. Analysts have
long said that opening up its financial markets was key to Beijing's efforts of
pushing the yuan as an alternative to the US dollar as a global reserve currency.
China signs $31bn currency
exchange deal with Australia
22 Mar 2012
China and Australia have signed a currency
swap agreement in a bid to promote bilateral trade and investment. It will
allow for the exchange of local currencies between their central banks, China
has been trying to promote the yuan as an alternative global reserve currency
to the US dollar. It has signed currency deals with many of its trading
partners, including Hong Kong and Japan. Analysts said the latest deal with
Australia, which is one of the biggest supplier of minerals and natural
resources such as coal and iron ore to China, is a major step in Beijing's
quest for a global role for its currency.
US Senate backs
debate on currency law amid yuan row
03 0ct 2011
The US Senate has voted in favor of
debating laws which could pressure China to let its currency rise in value. The
bill would give the US government the power to add tariffs to goods imported
from countries deemed to be undervaluing their currencies to boost exports.
Some politicians and trade groups say China uses its currency in such a way.
China's official news agency described the vote as a "publicity
attempt".
Bric summit ends in
China with plea for more influence
14 Apr 2011
The leaders of Brazil, Russia, India, China and South Africa said the
recent financial crisis had exposed the inadequacies and deficiencies of the
current monetary order, which has the dollar as the world's most-used currency.
The four nations have 40% of the world's population and almost a fifth of the
world's growth. These countries are worried about the long-term direction of
the dollar because of the US's large trade and budget deficits. China has been
diversifying into euros to reduce its dependency on the value of the dollar.
The development banks of the five nations agreed in principle to establish
mutual credit lines denominated in their local currencies.
Sarkozy in China for
G20 talks but yuan not on agenda
30 Mar 2011
French President Nicolas Sarkozy will convene a meeting of some of the
biggest names in world finance in Nanjing, China on Thursday. The gathering
will take place under the auspices of the G20 and will aim to smooth out global
currency issues. It is the first time China has hosted a G20 event. Other heavy
hitters from the world of international finance will be there, including US
Treasury Secretary Timothy Geithner, European Central Bank Governor Jean-Claude
Trichet, UK Chancellor George Osborne and the head of the International
Monetary Fund (IMF), Dominique Strauss-Kahn.
US looks for friends in fight against undervalued yuan
08 Feb 2011
China's currency is back in the spotlight amid reports that the US has
sought to increase the number of countries pushing for a stronger yuan. During
a visit to Brazil, US Treasury Secretary Timothy Geithner discussed the
manipulation of currency values. He urged Brazil to put pressure on China to
allow the yuan to appreciate. The US argues a weak currency gives China an
unfair advantage in global trade, keeping Chinese exports at artificially low
prices.
China's Hu Jintao: Currency system is 'product of past'
17 Jan 2011
Chinese President Hu Jintao has said the international currency system
dominated by the US dollar is a "product of the past". Mr. Hu also
said China was taking steps to replace it with the yuan, its own currency, but
acknowledged that would be a "fairly long process". Three Democratic
senators announced they would introduce a new bill to increase penalties the US
considers to be "currency manipulators".
Brazil Finance Minister Mantega warns of trade war
09 Jan 2011
Brazil has warned that the world is on course for a trade war because of
what it says is currency manipulation by China, the US and others. "This
is a currency war which is turning into a trade war," Mr. Mantega said.
The International Monetary Fund warned in October that some countries appeared
to be trying to use their currencies "as a weapon".
World Bank issues bond denominated in Chinese yuan
05 Jan 2011
The World Bank has issued its first bond denominated in the Chinese currency,
joining a small but fast-growing market. The yuan-denominated bond is being
issued to promote the use of the Chinese currency in international markets.
Other bodies, including the Asian Development Bank, and firms such as
McDonald's and Caterpillar have issued yuan bonds. China's stake in the World
Bank, which gives financial and technical assistance to developing countries,
is set to increase.
China backs Spain in new eurozone support
05 Jan 2011
The Chinese Vice Premier has reaffirmed his country will buy Spanish
government bonds, despite the recent crisis of market confidence over eurozone
debt. China has the largest amount of foreign currency reserves in the world.
China, Germany and South Africa criticize US stimulus
05 Nov 2010
Germany, China, Brazil and South
Africa have criticized US plans to pump $600bn (£373bn) into the US economy.
German Finance Minister Wolfgang Schaeuble said the US policy was
"clueless" and would create "extra problems for the world".
China's Central Bank head Zhou Xiaochuan urged global currency reforms.
US delays China 'currency manipulator' report
16 Oct 2010
The US government has delayed a
report - which was expected on Friday - that could officially brand China a
"currency manipulator". It has so far held back from naming China.
The report is not now expected until after an upcoming G20 summit. China said
the US should not use the weak yuan as a "scapegoat" for its own
economic problems.
IMF chief's warning of currency war 'real threat'
07 Oct 2010
Global currency wars pose "a real threat" to economic
recovery, the head of the International Monetary Fund, Dominique Strauss-Kahn,
has warned. Mr. Strauss-Kahn told the BBC that there were signs that countries
were trying to use their currencies "as a weapon". In recent weeks
both the US and Europe have led criticism of China over its undervalued yuan.
Meanwhile, Japan has been forced to intervene to curb rises in the yen.
Separately, Indian Finance Minister Pranab Mukherjee warned that imbalances in
the global economy have become "not sustainable".
EU takes on Chinese currency
05 Oct 2010
The European Union is riding in the
middle of an escalating currency spat between China and the United States,
perceived by many in Beijing as a smokescreen for Washington's efforts to sap
China's growth and contain its rise. The US House of Representatives voted
overwhelmingly last week to punish China for its currency policies that favor
unfairly Chinese exports at the expense of the United States and other
countries. Beijing suspects the US is keen on implementing a
Plaza
Accord scenario that back in the mid-1980s forced the Japanese yen
to jump almost 60% in a year, undermining Japanese growth and resulting in a
two-decade property slump and stagnation for Asia's once most vibrant economy.
Tan Yaling, head of the China Forex Investment Research Institute, says the
pressure on Chinese currency is only a "chapter in the US's plan of
war on all currencies."
Currency
'war' warning from Brazil's finance minister
28 Sep 2010
An "international currency war" is underway, Brazil's finance
minister, Guido Mantega, has warned. His comments follow a series of
interventions by governments to weaken their currencies and boost export
competitiveness. Japan, South Korea, and Taiwan are among those that have
recently tried to cut the value of their currencies.
US
Treasury Secretary Geithner says yuan is undervalued
16 Sep 2010
The US Treasury Secretary, Timothy Geithner, says China's currency is
significantly undervalued. Some members of the committee have called China a currency
manipulator. He hinted that the US was preparing to apply pressure on the
nation to force it into allowing faster appreciation.
China currency
stance 'impeding reforms', says Geithner
10 June
2010
Global economic reforms are being
impeded by China's refusal to revalue its currency, the yuan, US Treasury
Secretary Timothy Geithner has said. He told the US Senate Committee on Finance that distortions caused by
China's stance were "an impediment to the global rebalancing we
need".
China-US
talks: China vows more currency reform
24 May 2010
The currency is top of the economic agenda. The US argues that the yuan
is deliberately undervalued, giving Chinese exporters an unfair advantage in
global markets. Some analysts argue that the yuan is currently undervalued by
as much as 40%.
US Treasury delays China currency report
03 Apr 2010
The US Treasury is delaying by
several months a report on whether China manipulates its currency, the yuan.
Treasury Secretary Tim Geithner said he would delay the report, which was due
out on 15 April, until after a series of high-level international meetings.
Barack Obama urges China to relax grip on its currency
11 Mar 2010
President Barack Obama has urged
China to change its currency strategy, a move that would effectively raise the
value of the yuan and benefit US exporters. Mr Obama said in a speech to the
Import-Export Bank's annual conference that China should move to a "more
market-oriented exchange rate". The US Treasury Department is
considering whether to label China a "currency manipulator" in a
report due on 15 April.
Indonesian group prefers gold to dollars
20 Feb 2010
Guided by a Scottish-born convert
to Islam, a group of devout Indonesian Muslims is shunning
"worthless" paper money in favor of gold and silver coins for their
daily transactions. The followers of Sheikh Abdalqadir as-Sufi -- born Ian
Dallas -- trade goods such as food, medicine, clothes and phone cards with gold
dinars and silver dirhams in line with a strict interpretation of Islamic law.
Their anti-modern views sit uneasily with the naked capitalism of Indonesia's
teeming capital, the financial and political center of one of the fastest
growing economies in the world.
Foreign demand for US debt drops by record amount
16 Feb 2010
Foreign demand for US Treasury
bonds and notes fell by a record amount in December as China reduced its
holdings. The Treasury said foreign holdings of US debt dropped by $53bn,
surpassing the previous record set last April. China cut its holdings by
$34.2bn - meaning it is now the second-biggest US debt holder after Japan.
China has questioned whether the US bonds are safe and whether it can sustain
its deficits. It has also questioned the US dollar's role as the world's
reserve currency.
China hits back at US over trade and currency
04 Feb 2010
China has hit back at the US a day
after President Barack Obama promised to take a tougher line with Beijing over currency
and trade. Chinese foreign ministry spokesman Ma Zhaoxu insisted the value of
the Chinese yuan was not the main reason for China's trade surplus with the US.
LatAm leftists
tackle dollar with new currency
17 Oct 2009
Leftist Latin American leaders agreed on the creation of a regional currency,
the Sucre, aimed at scaling back the use of the US dollar. Nine countries of
ALBA met in Bolivia where they vowed to press ahead with a new currency for
intra-regional trade to replace the US dollar. ALBA's member states are
Venezuela, Bolivia, Cuba, Ecuador, Nicaragua, Honduras, Dominica, Saint Vincent
and Antigua and Barbuda.
The demise of the dollar
06 Oct 2009
In the most profound financial change in recent Middle East history, Gulf
Arabs are planning – along with China, Russia, Japan and France – to end dollar
dealings for oil, moving instead to a basket of currencies including the
Japanese yen and Chinese yuan, the euro, gold and a new, unified currency
planned for nations in the Gulf Co-operation Council, including Saudi Arabia,
Abu Dhabi, Kuwait and Qatar. Secret meetings have already been held by finance
ministers and central bank governors in Russia, China, Japan and Brazil to work
on the scheme, which will mean that oil will no longer be priced in dollars. It
augurs an extraordinary transition from dollar markets.
US dollar set
to be eclipsed, World Bank president predicts
28 Sep 2009
The United States must brace itself for the dollar to be usurped as the
world's reserve currency as American dominance wanes in the wake of the
financial crisis, the World Bank president, Robert Zoellick, warned yesterday.
Several countries, including China and Russia, have repeatedly raised what they
see as the problem of excessive dollar hegemony.
China launches
yuan trade scheme
06 Jul 2009
China has begun a trial scheme that allows trade with its neighbors to be
settled with its own currency, the yuan, also known as the renminbi. Six
Shanghai companies have signed contracts with counterparts in Hong Kong and
Indonesia to settle deals in the currency.
China argues
to replace US dollar
26 June 2009
China's central bank has reiterated its call for a new reserve currency to
replace the US dollar. The report from the People's Bank of China (PBOC) said a
"super-sovereign" currency should take its place "to avoid
intrinsic shortcomings in using a sovereign currency as a reserve currency. The
economic development model of debt-based consumption is most difficult to
sustain." Russian President Dmitry Medvedev recently joined Mr Zhou in
saying it was time to consider an alternative benchmark currency for
international debt.
Dollar poses
dilemma for Bric countries
15 Jun 2009
Brazil, Russia, India and China, collectively known as the Bric countries,
are holding their first formal summit in the Russian city of Yekaterinburg. On
the agenda is the role of the dollar and its status as the world's dominant currency.
Fears that these big holders of dollar assets may be looking to switch from the
US currency have unsettled financial markets and US politicians. These concerns
have in part led to a decline in the dollar against other major currencies in
recent months and sent jitters through the market for US government debt.
Will the US dollar
remain king?
26 Mar 2009
The dollar's role as the world's dominant currency is coming under intense
scrutiny. This week, China added its voice to demands for a new global currency
as an alternative to the dollar in international trade and finance. China's
central bank governor Zhou Xiaochuan called for a new reserve currency run by
the International Monetary Fund. As the world's largest holder of dollars,
China's comments cannot easily be dismissed. Should reserve managers begin to
shift away from the dollar, it would have a "massive impact" on US
markets.
Obama News
Conference
24 Mar 2009
Question: Taking this economic debate a bit globally, senior Chinese
officials have publicly expressed an interest in international currency.
Obama: So the goal at the G-20 summit, I think, is to do a couple of
things. Number one, say to all countries: Let's do what's necessary in order to
create jobs and to get the economy moving again. Let's avoid steps that could
result in protectionism, that would further contract global trade. The steps
that we've taken are ones that are restoring a sense of confidence and the
ability of the United States to assert global leadership.
Question: (Off-mike) global currency?
Obama: I don't believe that there's a need for a global currency.
China suggests
switch from dollar
24 Mar 2009
China's central bank has called for a new global reserve currency run by
the International Monetary Fund to replace the US dollar. With the world's
largest currency reserves of $2tn, China is the biggest holder of dollar
assets. China has long been uneasy about relying on the dollar for trade and to
store its reserves and recently expressed concerns that Washington's efforts to
rescue the US economy could erode the value of the currency.
Iran leader
dismisses US currency
18 Nov 2007
Iranian President Mahmoud Ahmadinejad has
suggested an end to the trading of oil in US dollars, calling the currency
"a worthless piece of paper".
Rapper Jay-Z
dissing the dollar
16 Nov 2007
In an apparent nod to the low value of the dollar, rapper Jay-Z's new video
Blue Magic features another currency. He is seen cruising the streets of New
York in Bentleys and Rolls Royces with a briefcase of 500 euro notes.
Supermodel
'rejects dollar pay'
06 Nov 2007
The world's richest model has reportedly reacted in her own way to the
sliding value of the US dollar - by refusing to be paid in the currency. Gisele
Bündchen is said to be keen to avoid the US currency because of uncertainty
over its strength.
Dollar Dropped
in Iran Asset Move
18 Dec 2006
Iran is to shift its foreign currency reserves
from dollars to euros and use the euro for oil deals in response to US-led
pressure on its economy. In a
widely expected move, Tehran said it would use the euro for all future
commercial transactions overseas. Analysts said Tehran had been steadily
shifting its foreign-held assets out of dollars since 2003 and that Monday's
announcement was unlikely to affect the value of the dollar, which has weakened
significantly in recent months.
Oil Producers
Shun Dollar
http://www.ft.com/cms/s/277471c2-8889-11db-b485-0000779e2340.html
11 Dec 2006
Oil producing countries have reduced their exposure to the dollar to the
lowest level in two years and shifted oil income into euros, yen and sterling,
according to new data from the Bank for International Settlements. The
revelation in the latest BIS quarterly review, published on Monday, confirms
market speculation about a move out of dollars and could put new pressure on
the ailing US currency.
Venezuela 'may
swap oil currency'
17 May 2006
Venezuela has hinted it could price its oil
exports in euros rather than US dollars, further weakening its links to the US. President Hugo Chavez said he was
considering taking the step following a similar declaration by Iran. Earlier
this month, Iranian authorities gave backing for the launch of an oil exchange
that traded solely in euros.
Rumored Iran
Plan has Blogs Breathless
04 Apr 2006
Iran has a plan to destroy America, and it has nothing to do with the bomb.
Instead, the Islamic republic will use oil and euros to slay the Great Satan,
breathless accounts on the Internet warn. The attack will proceed as follows:
Iran will open an oil trading exchange that operates in euros rather than dollars
-- until now, the world's sole currency for buying crude. Other countries,
whose central banks were holding onto dollars largely to buy oil, will dump
their dollars en masse. The greenback's value will collapse. The
American economy will tank. The U.S.-dominated New World Order will disappear
in a flurry of currency trades. It has veered deep into the Web's netherworld
of conspiracy theorists.
Syria Picks
Euros Over Dollars
14 Feb 2006
Syria has switched all of the state's foreign currency transactions to
euros from dollars amid a political confrontation with the United States.
Duraid Durgham, the head of state-owned Commercial Bank of Syria, said on
Monday: "Switching to the euro will help us avoid settlement problems in
the United States.”
The Real
Reasons Bush Went to War
08 Jul 2004
There were only two credible reasons for invading Iraq: control over oil
and preservation of the dollar as the world's reserve currency. In 1999, Iran
mooted pricing its oil in euros, and in late 2000 Saddam made the switch for
Iraqi oil. In early 2002 Bush placed Iran and Iraq in the axis of evil. If the
other Opec countries had followed Saddam's move to euros, the consequences for
Bush could have been huge. Worldwide switches out of the dollar, on top of the
already huge deficit, would have led to a plummeting dollar, a runaway from US
markets and dramatic upheavals in the US.
Imperial
Hubris by Michael Scheuer, 2004, Excerpts
Just under the noise, death, and
rhetoric yielded by the foregoing episodes of war lies a largely ignored factor
that may constitute al Qaeda’s main war effort – the steady bleeding of the
U.S. economy. The immediate
impact is massive expenditures – at all levels of American government – that
will add permanently to the size and cost of government. The September 11 attacks were not apocalyptic
onslaughts on Western civilization. They were country-specific attacks meant to
inflict substantial, visible, and quantifiable human and economic destruction
on America.