Currency Wars by
James Rickards, 2011, Excerpts
The currency itself is the ultimate
target in any financial war. Financial warfare is the preferred method of those
with inferior weapons but greater cunning. If you destroy the currency, you
destroy all markets and the nation. Three super currencies – the dollar, the
euro, and the yaun – are the superpowers in a new currency war.
And the Currency
Wars are now in full play with the Ukraine War.
Related:
In the News
Carlson Putin Interview
06 Feb 2024
Vladimir Putin: You know, to use the dollar as a foreign policy instrument to fight is one of the gravest strategic mistakes made by the US political leadership. The dollar is the cornerstone of the United States' power. I think everyone understands very well that, no matter how many dollars are printed, they are quickly dispersed all over the world. Inflation in the United States is minimal. It is about 3 or 3.4 per cent, which is, I think, totally acceptable for the US. But they won't stop printing. What does the debt of US $33 trillion tell us about? It is about the issuance.
Nevertheless, it is the main weapon used by the United States to maintain its power across the world. As soon as the political leadership decided to use the US dollar as a political instrument, a blow was dealt to this American power. I don’t want to use any unliterary expressions, but this is stupidity and a huge mistake.
Look at what is going on in the world. Even the United States' allies are now downsizing their dollar reserves. Seeing this, everyone starts looking for ways to protect themselves. But the fact that the United States applies restrictive measures to certain countries, such as placing restrictions on transactions, freezing assets, etc., causes grave concern and sends a signal to the whole world.
Putin signs order demanding gas payments in roubles from
Friday
31 Mar 2022
Vladimir Putin has indicated that Russia could rip up contracts to supply gas to Europe unless “unfriendly” states drop their refusal to pay in roubles from Friday. “To buy Russian gas, they need to open rouble accounts in Russian banks,” Putin said in a televised appearance on Thursday. “It is from those accounts that gas will be paid for, starting 1 April. If such payments aren’t made, we will consider this a failure by the client to comply with its obligations.”
Russian default looms as deadline for dollar bond
payments arrives
16 Mar 2022
Russia faced a crucial bond payment
on Wednesday that could lead to the sanctions-racked country defaulting for the
first time since 1998, and its first major international debt default since the
Bolshevik revolution a century ago. That could pave the way to a historic
default that would add to the intense pressure on the Russian economy.
https://www.bbc.com/news/business-60672085
09 Mar 2022
West to cut some Russian banks off from SwiftRussia will soon be unable to pay
its debts according to a leading credit ratings agency. Fitch Ratings
downgraded its view of the country's government debt, warning a default is
"imminent". The move comes amid increasing international sanctions
against Russia following its invasion of Ukraine. Moscow itself said its bond
payments may be affected by sanctions.
https://www.bbc.com/news/world-60542433
26 Feb 2022
Lebanon Warned of Implosion as IMF, World Bank Plead for Reforms
Trump's weaponization of the dollar could threaten its dominance
Markets fall sharply amid fears of full-scale US-China currency war
Trump Stirs the Currency War Pot.
Facebook plans to launch 'GlobalCoin' cryptocurrency in 2020
Turkey’s Cratering Markets Stoke Speculation Over Extreme Measures
Trump 'ready' to tax all Chinese imports
Trump Bucks Treasury in Ripping China, Russia as FX Meddlers
Venezuela's new bitcoin: an ingenious plan or worthless cryptocurrency?
Venezuela to launch cryptocurrency to combat US 'blockade'
Trump administration again declines to name China currency manipulator
Assad appears on Syrian banknote for first time
Qatari riyals no longer available at many UK banks
US and China sign trade agreement
Trump Florida Speech
Trump attacks China in Twitter outburst
Shock as India scraps
500 and 1,000 rupee bank notes
Egypt allows its
currency to float freely
Trump Republican Nomination Acceptance Speech
European Central Bank
to withdraw €500 note
Wall Street sinks as China turmoil hits global shares
IMF reforms clear last hurdle with US adoption
China and South Africa in $6.5bn worth of deals
China's yuan set for IMF reserve status
30 Nov 2015
China devalues yuan currency to three-year low
China-led AIIB development bank holds signing ceremony
France and Germany join UK in Asia bank membership
The EU, US and their allies have
agreed to cut off a number of Russian banks from the main international payment
system, Swift. Swift, or the "Society for Worldwide Interbank Financial
Telecommunication", is a secure messaging system that makes fast,
cross-border payments possible, enabling international trade. Russia is heavily
reliant on the Swift system for its oil and gas exports. Removing banks from
Swift is deemed to be a severe curb because almost all banks use the system.
Fears Mount About Inflation Returning With a Vengeance
https://www.bloomberg.com/news/articles/2020-05-03/sum-of-all-fears-still-can-t-dispel-speculation-about-inflation
02 May 2020
https://www.bloomberg.com/news/articles/2020-05-03/sum-of-all-fears-still-can-t-dispel-speculation-about-inflation
02 May 2020
Even a calamity of disease, death and economic destruction afflicting the world all at once isn’t enough to suppress the notion in some quarters that inflation could return with a vengeance. An environment of ultra-loose monetary and fiscal easing, commodity shortages, frayed supply chains and braking globalization might be fertile ground for surging consumer prices.
Money Is Losing Its Meaning
15 Apr 2020
By throwing trillions of
dollars at the coronavirus problem, governments risk undermining trust in
currencies. Doing “whatever it takes” to save the global economy from the
coronavirus pandemic is going to cost a lot of money. The U.S. government alone
is spending a few trillion dollars, and the Federal Reserve is creating another
few trillion dollars to keep the financial system from collapsing. For 12 major
economies including the U.S., China, euro zone and Japan, their aggregate money
supply had already more than doubled to $80 trillion from before the 2008-2009
financial crisis. These numbers are so large that they no longer have any
meaning; they are simply abstractions. After you throw a few trillion dollars
around, people start to believe that it’s all a big joke.
Lebanon Warned of Implosion as IMF, World Bank Plead for Reforms
17 Feb 2020
Lebanon is at risk of
“implosion” unless it develops a new governance model according to the World
Bank. Lebanon has been wracked by protests since October, which forced
then-Prime Minister Saad Hariri to step down, over worsening economic
conditions. The new administration of Premier Hassan Diab has asked the
International Monetary Fund for technical help, including over how it should
handle one of the world’s largest debt loads. The government’s debt stands at
more than 150% of gross domestic output and foreign investors have all but
priced in a sovereign default. A shortage of foreign exchange has caused a
currency black market to boom. Lebanon's currency has already devalued on the
parallel market.
US reverses China 'currency manipulator'
label
14 Jan 2020
The US has reversed its
decision to brand China a currency manipulator as the two countries prepare to
wind down their trade war. The US said it made the change because China had
agreed to refrain from devaluing its currency to make its own goods cheaper for
foreign buyers. The deal is aimed at de-escalating the tit-for-tat tariff war
the two countries have engaged in since 2018. Trump promised to label China a manipulator during his
2016 election campaign.
Trump's weaponization of the dollar could threaten its dominance
24 Oct 2019
The language of international
monetary policy has turned militaristic. The phrase “currency war” has been
popular for a decade and the US government’s more recent “weaponization” of the
dollar is generating controversy. But ironically, a martial approach could end
up threatening the US currency’s global dominance. The US dollar remains in
first place by a wide margin, followed by the euro, the yen and the pound. The
dollar also dominates on other measures of currency use in trade and finance.
The “weaponization” of the dollar generally refers to the US government’s
exploitation of the currency’s global dominance in order to extend the
extraterritorial reach of US law and policy.
Facebook's Libra should be blocked in
Europe, France says
11 Sep 2019
France says it will block
development of Facebook's Libra digital currency in Europe because it threatens
the "monetary sovereignty" of governments. The social media giant
announced plans for a currency in July, but the project has faced hostility and
skepticism. In Paris, Mr. Le Maire said: "This eventual privatization of
money contains risks of abuse of dominant position, risks to sovereignty and
risks for consumers and for companies." The US Congress is looking into
Libra's potential impact, while central bank chiefs, including the UK's Mark
Carney, have voiced skepticism. US President Donald Trump has tweeted he is
"not a fan" of the currency.
Markets fall sharply amid fears of full-scale US-China currency war
05 Aug 2019
Financial markets around the
world have fallen sharply amid growing fears that the US-China trade dispute
could escalate into a full-scale currency war, with damaging consequences for
the world economy. Stocks plunged on Wall Street on Monday around the world as
the trade war intensifies. Donald Trump renewed his attack on China, arguing in
a flurry of tweets that Beijing was using currency manipulation and unfair
trading practices to undermine jobs and company profits in America. China let
the yuan weaken below the sensitive seven-to-one dollar level for the first
time since 2008, in a step that some experts said could be used to “weaponize”
the Chinese currency in the trade dispute.
Trump Stirs the Currency War Pot.
03 Jul 2019
Less than two hours after the
Commerce Department said imports surged the most since 2015, President Donald
Trump turned to Twitter to accuse China and Europe of manipulating their
currencies to gain an unfair advantage
over the U.S. Trump has longed complained that the dollar’s strength is putting
the U.S. at a disadvantage, but he has become more vocal about the issue in
recent weeks – perhaps in a sign that he feels his trade wars aren’t delivering
the results he expected.
Libra: US Congress asks Facebook to pause
development
03 Jul 2019
The US Congress has asked
Facebook to pause development on its Libra cryptocurrency until lawmakers have
had more time to investigate the ramifications of the company’s actions. The
legislators ask the company to “immediately cease implementation plans”.
Although Facebook has spearheaded the development of Libra, the actual
development of the service will be handed over to the Libra Association, an
arms-length organization headquartered in Geneva, Switzerland. The association
is run by a consortium of Libra’s initial backers, including Visa, Lyft,
Vodafone and Coinbase, of which Facebook is just one partner among many. The
social network retains a significant amount of control, even paying the
salaries of the body’s “roughly half-dozen employees”, according to the
industry news site the Information.
Facebook plans to launch 'GlobalCoin' cryptocurrency in 2020
24 May 2019
Facebook is planning to launch
its own cryptocurrency in early 2020, allowing users to make digital payments
in a dozen countries. The currency, dubbed GlobalCoin, would enable Facebook’s
2.4 billion monthly users to change dollars and other international currencies
into its digital coins. The coins could then be used to buy things on the
internet and in shops and other outlets, or to transfer money without needing a
bank account. The company is looking to peg its value to a basket of
established currencies, including the US dollar, the euro and the Japanese yen.
Rebecca Harding, chief executive of banking trade data analytics firm Coriolis
Technologies, “There are no formal laws that govern this market because
cryptocurrencies are not legal tender.”
The Trade War's Grip on Currency Markets
Tightens
22 May 2019
Trade tensions between the U.S.
and China are starting to pull foreign-exchange markets into the arena. Yet far
from embracing their currencies as a weapon, many countries are being forced to
take a defensive posture against the almighty dollar. Policy makers in China,
South Korea and Indonesia were among those taking steps to buoy their
currencies as the prospect of more rapid depreciation raised the specter of
capital outflows. The standoff between the world’s two largest economies is
pushing uneasy investors into the greenback.
Qatar sues UAE, Saudi, Luxembourg banks
over riyal 'manipulation'
08 Apr 2019
Qatar has filed lawsuits in
London and New York against three banks for allegedly plotting to undermine its
currency and bonds. The cases named the United Arab Emirates' (UAE) First Abu
Dhabi Bank (FAB), Saudi Arabia's Samba Bank and Luxembourg-based Banque
Havilland.Qatar said Banque Havilland tried to weaken its currency, the riyal,
by submitting fraudulent quotes to foreign-exchange platforms in New York
allegedly intended to disrupt indices and markets where significant Qatari
assets and investors are located. Qatar has been facing an economic and
diplomatic blockade imposed by Saudi Arabia, the UAE, Bahrain and Egypt since
2017. The quartet accuses Doha of backing "terrorist" groups and
seeking closer ties with Saudi Arabia's regional rival, Iran.
Turmoil in Turkey's financial markets after
currency crackdown
28 Mar 2019
President Erdoğan’s government
heaped pressure on Turkey’s banks on Wednesday to stop them lending the lira to
overseas financial institutions, in a move that triggered the cost of offshore
borrowing in the Turkish currency to surge by more than 1,000% overnight. The
deploying of pressure on banks to stop lending the lira abroad, intended as a
crackdown on foreign currency speculation, comes at an increasingly delicate
time for emerging markets as the world economy slows, with deteriorating
economic growth in China amid the trade dispute with the US.
US shies away from calling China a currency
manipulator
18 Oct
2018
The United States has refrained from labelling China a
"currency manipulator" in a move which may help defuse escalating
tension over trade between the two countries. President Donald Trump has
previously accused China of keeping its currency weak to make exports more
competitive. President Trump argues the growth in Chinese exports to the US has
destroyed American jobs. He has ordered tariffs on more than $250bn of Chinese
exports to try to stem the US's growing deficit with China.
Turkey bans use of foreign currency in property market
13 Sep 2018
Turkey
is banning the use of foreign currencies in the country's property market as it
looks to stem the dramatic fall of its own currency, the lira. President
Erdogan issued a decree on Thursday announcing that contracts for sales, rent
and leasing must in future be made in lira. Thursday's decree said all current
agreements in the property sector made in foreign currencies must be changed
within 30 days. Rental and sale agreements in Turkey are often offered in euros
and dollars to foreigners living in the country. Mr. Erdogan said on Thursday
that nobody should carry out business in foreign currency apart from exporters
and importers
Argentina raises rates as peso plummets
31 Aug 2018
The
value of Argentina's peso continued to fall on Thursday, plunging by more than 13%
after a 7% drop a day earlier. The decline came despite the central bank's
effort to stabilize the currency by raising a key interest rate to 60%.
Interest rates of 40% already seemed like a bold idea back in May, when
Argentina tried to stop a first run on its currency. Taking it now to 60% seems
almost surreal. The situation prompted President Mauricio Macri to ask the IMF
to speed up its $50bn bailout, citing "more adverse" market
conditions. The peso has now fallen by more than 50% against the dollar this
year.
Venezuela devalues
currency and raises minimum wage by 3,000%
20 Aug 2018
Venezuela moved to shore up its
crumbling economy on Monday, devaluing its currency and preparing to raise the
minimum wage by more than 3,000% in a bid to tame rampant hyperinflation. On
Friday Maduro unveiled a dramatic raft of measures designed to end a depression
he blames on an “economic war” being waged by imperialist foes. The recovery
package includes measures such as raising taxes, increasing petrol prices for
some drivers, and introducing a rebranded currency – the sovereign bolívar –
which will have five fewer zeros than its inflation-stricken predecessor, the
bolívar. A recent survey found that about 90% of Venezuelans now live in
poverty while more than 60% admitted to waking up hungry because they lacked
the means to buy food.
Lira
Extends Slide as Erdogan Says Turkey in an Economic War
12 Aug 2018
Turkey’s lira
slumped for a fourth day to a new record low, with the sell-off spreading to
other emerging-market currencies, after the country’s president showed no signs
of backing down in a standoff with the U.S. The Turkish currency has been a
casualty of a deepening crisis spurred by the administration’s
growth-at-all-costs agenda and a worsening spat with the U.S., which sanctioned
Turkey over the detention of an American priest. The lira’s plunge sparked
tremors through global markets on Monday. Erdogan remained defiant, saying the
country is in an “economic war.” He also ruled out an agreement with the
International Monetary Fund. Years of a growth-at-all-costs policy bias have
left Turkey’s companies saddled with hundreds of billions of dollars in foreign
debt, runaway inflation and one of the world’s largest current-account
deficits.
JPMorgan
Says Trump May Sell Dollars as Weapon in U.S. Trade War
08 Aug 2018
With the U.S.
waging a trade war on several fronts, economists are starting to take seriously
the idea that President Donald Trump could act on his preference for a weak
dollar. “While not our base case scenario, we cannot rule out a turn toward a
more interventionist currency policy, particularly since the current
administration has, at times, hinted at a preference for dollar weakness or
objected to perceived Chinese currency manipulation,” Michael Feroli, JPMorgan
Chase & Co.’s chief U.S. economist, said in a research note this week. In a
Twitter flurry last month, Trump accused China and the euro area of
manipulating their currencies and complained that a rising dollar is blunting
America’s “competitive edge.” If China takes the lead in a currency war,
letting the value of the yuan fall, it could have a deflationary impact around
the world, Oxford Economics said in a note this week.
Turkey’s Cratering Markets Stoke Speculation Over Extreme Measures
07 Aug 2018
Desperate
measures are in the air in Turkey: trading rooms are awash with talk of a
bailout by the IMF and potential capital controls. The central bank and
government have remained largely silent as the currency plummeted to record
lows and the U.S. imposed sanctions and threatened more. The lira rebounded
after falling by the most in a decade on Monday, getting a lift from news that
Turkish officials were headed to Washington for talks. The lira is buckling
under the weight of one of the widest current-account deficits in emerging
markets and inflation is spiraling ever higher. Turkey has overtaken Argentina
as the world's worst place for debt investors
IMF projects
Venezuela inflation will hit 1,000,000 percent in 2018
23 Jul 2018
The South American nation’s economy
has been steadily collapsing since the crash of oil prices in 2014. “We are
projecting a surge in inflation to 1,000,000 percent by end-2018 to signal that
the situation in Venezuela is similar to that in Germany in 1923 or Zimbabwe in
the late 2000’s,” Alejandro Werner, director of the IMF Western Hemisphere
department. Consumer prices have risen 46,305 percent this year. The nation’s
central bank had halted the release of basic economic data. President Nicolas
Maduro says the country is victim of an “economic war” waged by opposition
businesses with the support of Washington. His government routinely dismisses
the IMF as a pawn of Washington.
Trump 'ready' to tax all Chinese imports
20 Jul 2018
The President has also been
complaining that a strengthening dollar has been hurting US business. In a
series of tweets he blamed the higher dollar on currency
"manipulation" by China and the European Union. Trump says he is
ready to intensify his trade war with China by slapping tariffs on all $500bn
of imports from the country.
China Won’t Weaponize
the Yuan in Trade War
02 Jul 2018
Chinese central bankers vowed to
keep their nation’s currency stable and to not deploy it as a weapon in the
trade conflict with the U.S., helping the yuan reverse some of its recent
plunge. The yuan is the worst performing currency in Asia over the past three
weeks, losing 3.7 percent against the dollar as the domestic economy slows and
the nation slides closer to a trade war with the U.S. A failure to contain the
tumble will feed speculation that officials are effectively depreciating the
currency to defend against the effects of trade tariffs.
Argentine Peso
Resumes Plunge After Central Bank Shakeup
15 Jun 2018
The Argentine peso resumed its
slide toward a historic low as a major shakeup that put a former Wall Street
trader at the helm of the nation’s central bank failed to curb the currency’s
massive volatility. Investors had expected that a $50 billion deal with the
International Monetary Fund last week would return calm to the market. Instead,
the peso collapse has added to the woes of a country already under siege from
double-digit inflation and a ballooning current-account deficit.
Turkish lira dives
against the dollar
23 May 2018
The Turkish lira has fallen more
than 5% to hit a record low against the US dollar. The currency has lost more
than a fifth of its value this year as fears grow that the government might
undermine the powers of Turkey's central bank. Mr. Erdogan said he plans to
take more control of the country's finances after a general election on 24
June.
U.S. Raises Pressure
on Iran With Sanctions on Currency Exchange
11 May 2018
The U.S. took a step toward cutting
Iran off from the global economy on Thursday, levying sanctions on a financing
network and accusing the country’s central bank of helping funnel U.S. dollars
to the blacklisted elite military unit known as the Quds Force. Acting jointly
with the United Arab Emirates, the U.S. Treasury Department imposed sanctions
on several Iranian companies, individuals and officials it said are operating
an illegal currency-exchange network in the U.A.E.
Iranians launch
banknote protest to get round censorship
29 Apr 2018
A group of Iranian Twitter users
are spreading protest messages by writing slogans on banknotes. "Banknotes
are our un-censorable messengers," one user wrote, referring to a rumored
plan to permanently block the popular messaging app Telegram, which is by far
the most popular digital communication tool in Iran. Around 40 million Iranians
- half the population - use the Telegram app. Slogans included "I am an
overthrower". Other messages read: "Our enemy is right here, they say
it's America".
Trump Bucks Treasury in Ripping China, Russia as FX Meddlers
16 Apr 2018
Trump took to Twitter on Monday to
declare that China and Russia are playing what he called a “currency
devaluation game” at a time when the U.S. Federal Reserve is raising interest
rates. “Not acceptable!,’’ Trump wrote. His comments contradicted a Treasury
Department semi-annual report on Friday that refrained from naming any country
a currency manipulator based on specific criteria.
Time to spend your
old tenners – just three shopping days left
26 Feb 2018
The cut-off date for using
old-style paper £10 notes is fast approaching, with just three shopping days
left before the Thursday March deadline when they cease to be legal tender. The
new plastic £10 note featuring Jane Austen came into circulation in
mid-September, replacing the £8bn-worth of notes that carry the image of
Charles Darwin.
Venezuela's new bitcoin: an ingenious plan or worthless cryptocurrency?
19 Feb 2018
Venezuela prepares for the pre-sale
of its new bitcoin-like digital currency called the petro. The launch on
Tuesday comes amid a deep economic crisis and a government politically isolated
and cut off from most international financing. Maduro claims that each petro
token will be backed by one barrel of the oil-rich nation’s petroleum, and
claims that about 100 million petro tokens worth some $6bn will be issued. The
petro is designed to raise hard currency and to function as a payment method
for foreign suppliers now that most transactions have been stymied by financial
sanctions imposed by Washington last year. Some analysts see the petro as a
desperate move to secure cash amid an unprecedented economic meltdown.
Venezuelans are now suffering from widespread food shortages, hyperinflation
that could hit 13,000% this year, and the collapse of the traditional currency,
the bolívar.
Venezuela to launch cryptocurrency to combat US 'blockade'
03 Dec 2017
President Nicolas Maduro has said
Venezuela would launch a cryptocurrency to combat a US-led financial
“blockade”. The digital currency will be backed by Venezuelan reserves of gold,
oil, gas, and diamonds. US sanctions are hurting Venezuela’s ability to move
money through international banks. Currency controls and excessive money
printing have led to a 57% depreciation of the bolivar against the dollar in
the last month alone on the widely used black market. Maduro says he is trying
to combat a Washington-backed conspiracy to sabotage his government. He said
Venezuela was facing a financial “world war.”
Venezuela’s Behind on
Its Debt and Facing Two Huge Bond Payments
23 Oct 2017
Increasingly isolated by U.S.
financial sanctions, Venezuela has already fallen behind on interest payments
worth $350 million that were due earlier this month. While the plunge in crude
prices deepened an economic collapse and triggered a humanitarian crisis,
President Nicolas Maduro, has been determined to meet all foreign bond
payments. He’s cut imports to free up hard currency for debt payments, tapped
China and Russia for loans and mortgaged some of the country’s gold stash.
Yields on the bonds have been eye-catching: over 9 percent per year on average
over the past 20 years. This combination -- outsize profits for Wall Street traders
and shortages of food and medicine for Venezuelans back on the ground -- has
been so jarring that it even led to the coining of a new term for the nation’s
debt: hunger bonds.
Trump administration again declines to name China currency manipulator
17 Oct 2017
The United States on Tuesday
declined to name China as a currency manipulator although it remained critical
of the Chinese government’s economic policies ahead of a planned visit to
Beijing by President Donald Trump, but it kept China on a currency “monitoring
list”. Trump, who on the campaign trail blamed China for “stealing” U.S. jobs
and prosperity by cheapening its currency, had repeatedly promised to label the
country as a currency manipulator on “day one” of a Trump administration - a
move that could lead to punitive duties and other action. But the president’s
comments on China have been less harsh since he took office in January.
Assad appears on Syrian banknote for first time
03 Jul 2017
President Bashar al-Assad has
appeared on the Syrian currency for the first time since taking office, with
his portrait printed on a new 2,000-pound banknote ($3.9) that went into
circulation on Sunday. The currency previously only carried images of historic
icons or pictures of his father. Syria's currency has plunged in value since
the country's conflict began in 2011. Inflation has also soared.
Qatari riyals no longer available at many UK banks
Individual customers at Barclays,
RBS, Lloyds Banking Group and Tesco Bank cannot currently buy or sell riyals.
In early June, Qatar's Gulf neighbours Saudi Arabia, UAE, Bahrain and Egypt
ceased air, sea and land links with the country, which has been accused of
funding terrorism. Qatar denies the claim. The cutting of diplomatic ties by
Qatar's neighbors has prompted wide fluctuations in the value of the country's
currency.
US and China sign trade agreement
12 May 2017
No longer do you hear the words
"currency manipulator" or "unfair trade partner" from
Trump's lips. The US and China have reached a 10-point trade deal that opens
the Chinese market to US credit rating agencies and credit card companies.
Under the deal, China will also lift its ban on US beef imports and accept US
shipments of liquefied natural gas. In return, Chinese cooked chicken will be
allowed into the US market and Chinese banks can enter the US market.
Donald Trump: China
'not a currency manipulator'
13 Apr 2017
Donald Trump has said his
administration will not label China a currency manipulator, rowing back on a
campaign promise. He made the comments days after meeting China's President Xi
Jinping. Before the US election, Mr. Trump promised to label China a currency
manipulator on his first day in office.
South Africa's credit
rating has been cut to junk status
03 Apr 2017
South Africa's credit rating has
been cut to junk status by the ratings agency S&P Global. The agency said
that political upheaval was endangering the economy. S&P also expressed
concern over the nation's debt situation and in particular the expense of backing
state energy firm Eskom. Moody's is due to make its latest pronouncement on
South Africa's credit rating on Friday. It has the country two notches above
junk status.
Trump Florida Speech
18 Feb 2017
My administration has begun plans
to crack down on foreign cheating and currency manipulation which is killing
our companies and really, really hurting our workers. We're going to end it.
South Africa's rand
currency 'rigged by banks'
16 Feb 2016
Local and international banks have
been accused of rigging the price of South Africa's currency, the rand. Global
giants Barclays, JP Morgan and HSBC are among 17 banks named as part of the
two-year investigation. Banks colluded, using online chat rooms to co-ordinate
fictitious bids and offers in order to sway the market. President Zuma recently
accused the country's four largest banks of controlling the economy. The South
African rand has nearly halved in value against the US dollar over the past
five years, as the country goes through an economic crisis.
Japan rejects Trump
accusation of devaluing yen in currency war
01 Feb 2016
Japan has rejected Donald Trump's
claims that Tokyo was deliberately weakening the yen to gain an unfair trade
advantage, along with China and Germany, were guilty of "global
freeloading" for using regulation and currency devaluation in their trade
dealings with the US. The president's trade adviser, Peter Navarro, also
accused Germany of using a "grossly undervalued" euro to gain an
unfair advantage over the US and other EU countries.
Merkel rejects Trump
advisor euro claim
31 Jan 2017
The German Chancellor has rejected
comments made by a Trump advisor that Germany uses an undervalued euro to
exploit trading partners. Peter Navarro, the head of Mr. Trump's National Trade
Council, told the Financial Times that the euro is a German currency in
disguise. The US regularly tells China its currency is too cheap and gives its
products an advantage in world markets. Mr Navarro is also an economics
professor at the University of California, Irvine. Mr Navarro has been a fierce
critic of China.
Euro 'could fail',
says man tipped as US ambassador to EU
25 Jan 2017
The man tipped to be Donald Trump's
ambassador to the European Union, Professor Ted Malloch, has told the BBC the
single currency "could collapse" in the next 18 months. He also
questioned the future of the single currency. "I think it is a currency
that is not only in demise but has a real problem and could in fact collapse in
the coming year, year and a half. I am not the only person or economist of that
point of view. Joseph Stiglitz - the famous World Bank economist - has written
an entire book on this subject."
Venezuela's new high
value banknotes enter circulation
17 Jan 2017
Venezuela has issued new larger
denomination banknotes in response to the country's soaring rate of inflation.
The three notes, ranging from 500 to 20,000-bolivars, have entered circulation
with the aim of making paying for essentials easier. Until now, the 100-bolivar
note had been the country's largest, worth just three US cents on the black
market. The new 20,000-bolivar note is still worth less than $6 on the black
market. Inflation in Venezuela is forecast to reach 1,600% this year.
Venezuela pulls
highest-value banknote 'to strike against mafia'
12 Dec 2016
The Venezuelan government has
announced it will remove the country's highest-denomination banknote from
circulation within 72 hours to combat contraband, making up almost half of all
currency. Venezuelans will have 10 days from Wednesday to exchange the notes
for coins and new, higher-value bills. The president said the aim was to tackle
transnational gangs which hoard the Venezuelan notes abroad, a move he has in
the past described as part of the "economic war" being waged against
his government. Venezuela's currency has fallen dramatically amid skyrocketing
inflation. The International Monetary Fund estimates that next year's prices
will rise by more than 2,000%.
Trump attacks China in Twitter outburst
05 Dec 2016
US President-elect Donald Trump has
posted a series of tweets criticizing China for its monetary policy and its
operations in the South China Sea. "Did China ask us if it was OK to
devalue their currency. I don't think so!" The US has previously
criticized China's yuan devaluation, saying it unfairly favors Chinese
exporters.
Venezuela issues new banknotes after inflation
04 Dec 2016
Venezuela is issuing new
higher-value notes to help deal with soaring inflation. A backpack full of cash
is often required to pay bills at a restaurant or supermarket. The central bank
said that six new bills ranging from 500 to 20,000 bolivars would come into
circulation on 15 December. Currently the largest note is 100 bolivars and
worth about two US cents. Over the past month, the currency has tumbled by 60%
against the dollar on the black market. President Nicolas Maduro blamed the
economic crisis is being backed by the US. The International Monetary Fund
(IMF) estimates that next year's prices will rise by more than 2,000%.
Mexican peso hits
record low as Trump wins U.S. election
09 Nov 2016
The Mexican peso plunged to a
record low on Wednesday as stunned investors digested the news that billionaire
businessman Donald Trump had won the U.S. presidential election. The Mexican
peso sank more than 13 percent at one point, to an all-time low just below
21.00 pesos per dollar, before recovering some ground to trade around 19.91
pesos per dollar, still down 8 percent on the day.
09 Nov 2016
Indian Finance Minister Arun
Jaitley says "honest people" have no need to worry about a decision
to scrap 1,000 and 500 rupee notes, the move would flush out tax evaders, help
India move towards a cashless economy, saying that farmers could "now keep
their money in banks". The surprise move, announced on Tuesday evening, is
part of a crackdown on corruption and illegal cash holdings. The announcement
was met with shock in India. The banknotes declared illegal tender represent
85% of cash in circulation in India. People will be able to exchange their old
notes for new ones at banks over the next 50 days but they stopped being legal
tender at midnight on Tuesday. There are also going to be limits on cash
withdrawals from ATMs starting on Thursday. The idea here is to lock out money
that is unaccounted for and make it visible for tax purposes - banks will be
happy to exchange a few thousand rupees, but will be asking questions of those
who turn up with hundreds of thousands or millions in currency.
03 Nov 2016
Egypt has floated its currency in a
move that has reduced its value by almost 50% against the dollar. The move is a
key requirement of the International Monetary Fund (IMF), from which Egypt is
asking for a $12bn loan over three years. Another reform it is facing is
reducing or removing altogether state subsidies on fuel to meet IMF conditions.
It has already cut subsidies on household electricity and increased the price
of sugar by 40% for some Egyptians. Egypt has struggled to attract foreign investment
since the political turmoil in 2011 during the so-called Arab Spring that saw
former president Hosni Mubarak overthrown. The change of regime dented tourism
numbers, one of Egypt's most important foreign currency earners, and prompted a
general fall in international investor confidence. Egypt's economy is the
second largest in the Arab world, after Saudi Arabia.
Less than one euro to
the pound at many UK airports
10 Oct 2016
The continued fall in sterling's
value means that the average rate available at 17 airport bureau of exchange is
now just 99 euro cents to the pound. Since the UK's Brexit vote in June, the
pound has fallen sharply in value. The average US dollar rate at the airports
is down to $1.08 to the pound.
Hammond urges calm
over pound flash crash
07 Oct 2016
The pound was pummelled in the
currency markets in Friday Asian trading, with traders blaming concerns over
Brexit and a flash crash that hit the market. The pound briefly fell 6% to
$1.1841, the biggest move since the Brexit vote. Sterling later recovered most
of those losses but remained 1.3% lower. Analysts think a news report could
have triggered automated trading systems to sell the pound heavily in a short
space of time. Analysts at HSBC are forecasting that the pound could fall to
$1.10 and could be worth just one euro by the end of next year.
The world's worst
performing currency right now is Mongolia's
17 Aug 2016
Mongolia's currency is on its
longest losing streak on record as the government grapples to contain an
economic crisis. Back in 2011, a mining boom helped make it the world's
fastest-growing economy with growth in gross domestic product of around 17.5%.
But then commodity prices collapsed. And so did demand from China, which buys
90% of Mongolia's exports, making it the world's worst-performing currency,
says Bloomberg data. Due to its cash shortage, Mongolia has borrowed massively
and now owes dinosaur-sized interest payments of a debt load of nearly $23bn.
This has fueled speculation that Mongolia could face a sovereign default or
need a bailout. A delegation from the International Monetary Fund arrived in
the capital Ulaanbaatar today.
Trump Republican Nomination Acceptance Speech
21 Jul 2016
We are going to enforce all trade
violations against any country that cheats. This includes stopping China’s
outrageous theft of intellectual property, along with their illegal product
dumping, and their devastating currency manipulation. Our horrible trade
agreements with China, and many others, will be totally renegotiated.
Nigeria uncouples
naira from dollar to combat currency crisis
15 Jun 2016
Nigeria says it will allow the
embattled naira to trade freely in a move to control the currency crisis in
Africa's most populous nation. The new system is to come into effect on 20 June
and is expected to lead to a significant devaluation of the naira. Being a major oil exporter, Africa's biggest
economy has been severely hit by the fall in commodity prices. The fixed
currency rate had created a vast black market for US dollars and squeezed the
country's economy.
Officials: US
considers easing ban on dollars to help Iran
01 Apr 2016
The Obama administration is
considering easing financial restrictions that prohibit U.S. dollars from being
used in transactions with Iran. The change could prove significant for Iran’s
sanctions-battered economy. It also would be highly contentious in the United
States, where Republican and some Democratic lawmakers say the administration
promised to maintain a strict ban on dollars.
05 May 2016
The European Central Bank (ECB)
says it will no longer produce the €500 (£400; $575) note because of concerns
it could facilitate illegal activities. It will stop issuing the note around
the end of 2018, when it will bring in new €100 and €200 banknotes. The UK
asked banks to stop handling €500 notes in 2010 after a report found they were
mainly used by criminals. A report earlier this year for the Harvard Kennedy
School, urged the world's 20 largest economies to stop issuing the largest
notes in circulation - £50, $100 and €500 notes - to tackle crime, the
high-denomination notes were favored by terrorists, drug lords and tax evaders.
Trump accuses China
of 'raping' US with unfair trade policy
02 May 2016
Republican presidential
front-runner Donald Trump has accused China of "raping" the US, in
renewed criticism of China's trade policy. Mr Trump, a billionaire businessman,
has long accused China of manipulating its currency to make its exports more
competitive globally. This, he says, has badly damaged US businesses and
workers. "We can't continue to allow China to rape our country, and that's
what we're doing," he told the campaign rally on Sunday.
South Africa's
economy 'in crisis'
24 Feb 2016
The South African economy is 'in
crisis' says the country's finance minister Pravin Gordhan, he cut the
country's growth forecast for 2016 to 0.9%, down from 1.7%. He conceded the economy is struggling with
shrinking growth, 25% unemployment, and widespread poverty. The South African
currency, the rand, which has halved over the past five years, fell after the
speech. It fell around 2.25% to make one rand worth around $0.0639. He had been
expected to announce plans on privatizing state assets.
Pound hits lowest
level against dollar since 2009 on Brexit fears
22 Feb 2016
The pound hit its lowest level
against the dollar in almost seven years on concerns about a possible UK exit
from the European Union. The steep fall adds to losses made by the pound over
recent months. So far this year, fears of a British exit from the EU - dubbed
'Brexit' - have already pushed the pound down by more than 4% against the US
dollar. The pound has already dropped more than 17% against the dollar in the
last 18 months, partly due to the outlook for UK interest rates.
China bank chief says
'speculators' caused yuan fall
14 Feb 2016
He said there was no reason for the
yuan to keep depreciating in value and that China would not let international
speculators dominate market sentiment. Efforts to defend the yuan have eroded
China's foreign currency reserves. In January alone, the reserves plunged by
$99.5bn as the People's Bank of China sold dollars in an effort to shore up the
value of the yuan. Fears of an economic slowdown have caused some investors to
move their money out of China in search of better returns elsewhere. The
Chinese authorities fear a rapid devaluation of their currency, as it could
destabilize the economy. To stabilize the situation, China has been selling
dollars and buying yuan.
Yellen warns US
financial conditions have worsened
10 Feb 2016
Ms. Yellen added China's
"unclear" currency policy was fueling global stock market volatility.
She said the decline in China's currency, the yuan, had "intensified
uncertainty about China's exchange rate policy and the prospects for its
economy. This uncertainty led to increased volatility in global financial
markets and exacerbated concerns about the outlook for global growth."
China's currency
reserves plunged in January
07 Feb 2016
China's foreign currency reserves
plunged by $99.5bn in January, the People's Bank of China reported. China has
been running down its vast foreign currency reserves in an attempt to boost the
value of its own currency and stem a flow of funds overseas The Chinese
authorities fear a rapid devaluation of their currency, as it could destabilize
the economy. To stabilize the situation China has been selling dollars and
buying yuan. At $3.23 trillion, China still has the world's biggest reserve of
foreign currency holdings. But that has declined by $420bn over six months and
stands at the lowest level since May 2012. "While the remaining reserves
still represent a substantial war chest, the mathematics around this rapid pace
of depletion in recent months is simply unsustainable for any length of
time," said Rajiv Biswas, Asia Pacific Chief Economist, IHS Global
Insight.
Why is the pound
falling so sharply?
19 Jan 2016
The value of the pound has been
sliding on international currency markets, declining nearly 4% since the start
of 2016. It has been losing ground against the euro for the past eight weeks,
its longest downward streak since the single currency was introduced in 1999.
Last week, it hit its lowest level in euro terms for a year. Against the
dollar, it has fared even worse, plumbing depths not seen since mid-2010. That
makes it one of the worst performing major currencies. Chancellor George
Osborne recently warned that the UK was facing a "cocktail" of
serious threats from a slowing global economy. He added that this year was
likely to be one of the toughest since the financial crisis, "2016 is the
year of mission critical". In the words of Esther Reichelt of Commerzbank,
"the headwinds to the British economy have definitely increased."
GOP debate in North
Charleston, South Carolina.
14 Jan 2016
TRUMP:
China is ripping us on trade. They're devaluing
their currency and
they're killing our companies. Thousands of thousands we've lost because of China.
We've lost anywhere between four
and seven million jobs because of China. We have very unfair trade with China. We're going to have a trade deficit
of 505 billion dollars this year with China." A lot of that is because they devalue
their currency.
We have great power, economic power
over China. If they
don't start treating us fairly and stop devaluing and let their currency rise, I would
certainly start taxing goods that come in from China. They can't believe how stupid the American leadership is.
CRUZ:
Donald is right that China is running over
President Obama like he is a child.
Wall Street sinks as China turmoil hits global shares
07 Jan 2016
Wall Street shares closed sharply
down after the suspension of trading on Chinese markets for the second time
this week spread alarm among investors. The slump on Chinese markets prompted
renewed panic on global markets. Share dealing was halted in the first 30
minutes, making it China's shortest trading day on record. China is responsible
for 17% of all the world's economic activity, it is the second largest economy
and the second largest importer of both goods and commercial services.
Investors are nervous after the Chinese central bank moved to weaken the
country's currency, the yuan, for the eighth day running, sparking fears of a currency war. This move is designed to boost
exports by making Chinese goods cheaper outside the country. There is now a lot
more pressure on other Asian countries to depreciate their currencies in
response to China's move. Legendary US billionaire investor George Soros has
warned that 2016 could see a global financial crisis on as big a scale as that
seen just eight years ago.
IMF reforms clear last hurdle with US adoption
http://www.bbc.com/news/business-35141683
19 Dec 2015
19 Dec 2015
The US Senate has adopted
long-awaited reforms to give emerging economies a greater say in how the
International Monetary Fund (IMF) is managed. China's voting rights will rise
to 6%, from 3.8%. This is the biggest shake-up since the IMF and the World Bank
were set up to manage the post-World War Two economy. China has set up the
Asian Infrastructure Investment Bank as an alternative to the IMF and the WB.
As China's voting rights rise, the US will see its share drop from 16.7% to
16.5%. India's voting rights will rise to 2.6% from the current 2.3%. The
biggest losers are European economies which will see their voting rights
diminished. The IMF now includes China's currency as a reserve currency,
alongside the US dollar, the euro, the yen and the British pound.
China and South Africa in $6.5bn worth of deals
China and South Africa have signed
deals and loans valued at $6.5bn (£4.3bn), with the focus on building
infrastructure in the African giant. The deals were announced during a four-day
visit by Chinese President Xi Jinping to increase trade and investment between
the two countries. About 26 deals were signed on Wednesday, with $2.5bn going
to South Africa's state-owned rail operator.
China has given a series of loans to African countries for development.
The countries, in turn, provide oil and other key commodities to the world's
second largest economy.
China's yuan set for IMF reserve status
30 Nov 2015
The International Monetary Fund
(IMF) is expected to announce on Monday that China's currency, the yuan, will
join the fund's basket of reserve currencies. Just the US dollar, the euro,
Japan's yen and the British pound are currently part of this select band. The
yuan will now make up part of the IMF's Special Drawing Rights - an asset
created by the IMF which serves almost as a currency. More than anything this
move is a symbol - a powerful one - of China's meteoric rise, from poverty to
pillar of the global economy. The yuan
will become one of the top three major international currencies, together with
the dollar and the euro. Concerns about Beijing keeping the yuan
artificially low to help exporters is one reason the currency has previously
failed to meet the criteria for reserve currencies set out by the IMF.
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.
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