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Tag Archives: rmb

China’s Central Bank Condition Has Consistently Told You Everything About Global (not) Inflation

For several years now, we’ve been harping constantly and consistently about what’s on the PBOC’s balance sheet; or, really, what conspicuously isn’t in very specific line-item numbers. Briefly, simply, if dollars are being extended into China, as has been claimed over the years, particularly the last few, they’re going to show up on the Chinese central bank’s balance sheet. Specifically, foreign assets. More specifically, foreign reserves. There’s a difference between those two which...

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From China: Dollar, Deflation, And The RRRest

It’s not necessarily a discrepancy so much as maybe looking at the same thing from a different point of view. China’s State Administration of Foreign Exchange (SAFE) reports on, among other things, the widest definition of foreign assets being under its whole national umbrella. Yet, the agency publishes balances denominated not in CNY, either US$’s or SDR’s (hey, they can dream!) instead. The country’s central bank, the People’s Bank of China (PROC), owns, holds, and manages (a...

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How Do You Spell Escalating? C-H-I-N-A-R-R-R

There are three letters you never want to see hit the Chinese news. Actually, it’s the same letter just repeated three times. If the People’s Bank of China (PBOC), the country’s central bank and top bank regulator, ever decides to reduce or cut their RRR you know things are getting serious. And not in a good way.This, of course, won’t stop the mainstream media from printing countless stories extolling the virtuous accommodation a lower RRR brings with it – in theory. Actually, it’s the same...

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No Reflation Here: PBOC Balance Sheet Update May (Same As April)

For the month of May 2021, China’s central bank reported almost exactly the same as it had in April (or March). In the case of foreign assets, as has become standard, nearly identical. Despite reflation dollar flows being described and talked about, they still haven’t reached the official PBOC balance sheet which after so many months of this simply reduces the charade to a mockery.Something is going on in the shadows, and one thing it can’t be is the usual reflationary dollar inflows. If...

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Xi To Davos: If You’re Waiting For Us, We’re Waiting For You

The Chinese erstwhile dictator Xi Jinping asked the Davos gathering of the superrich, can’t we all just get along? More than a weird juxtaposition, appearing virtually before other virtual attendees, the Communist strongman wanted to make plain his view, therefore China’s, he harbors no desire for a renewal of the Cold War. Though we come from very different places and have lived very different experiences, these shouldn’t be impediments to more peaceful cooperation. What is and really has...

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Six Point Nine Times Two Equals What It Had In Twenty Fourteen

It was a shock, total disbelief given how everyone, and I mean everyone, had penciled China in as the world’s go-to growth engine. If the global economy was ever going to get off the ground again following GFC1 more than a half a decade before, the Chinese had to get back to their precrisis “normal.” In 2014, the clock was ticking but expectations were extremely high nonetheless.In September 2014, however, massive setback. Though it had been building all year by then – CNY abruptly falling...

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The Contingent Hole In China’s Brazil Dollar Strategy

The Brazil strategy isn’t, of course, truly Brazilian. Like the Spanish flu which became famous for where it was first noticed and reported rather than where it originated, this monetary policy was thought up elsewhere and Banco do Brasil is merely the central bank which decided it was worth sharing.What is this Brazil (my term, by the way) policy? “Contingent liabilities.” A well known advantage of issuing such contingent liabilities as currency swaps is that authorities become able to...

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Xi Has Upped His (Ruthless) Game; Dollar Scarcity, Chinese Economy, and the World Surrounding All of It

There’s one key piece of the “petroyuan” story which has gotten lost in the frenzied hype. While many get fixated, and make others fixate, on how RMB-for-oil was going to, or maybe even still will, destroy the dollar there’s been important, legitimate functions for Shanghai’s International Exchange which don’t involve, and never really did, replacing the reserve currency. It’s all about dollar burden, lightening the monetary load in a reserve system that doesn’t supply enough of it (nor...

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Not This Again: Time For Petroyuan Revisit

Does anyone remember the petroyuan? It doesn’t appear so, though not because the thing disappeared rather due to the fact that it didn’t. It was a really big deal for a time, pretty much all of 2018. What it was supposed to have represented was the dollar’s death knell. Guaranteed, one hundred, no, one thousand percent dead. This was widely reported more than a few times as fact, a perfectly frenetic parallel to the related inflation hysteria then raging. Right from the start of 2018, we...

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What’s In The Same Number? China’s Part In The (euro)Dollar Story

There’s one part of the dollar story I’ve not yet touched on recently. We’ve already heard, too much, about how the Fed’s killing the dollar, or at least is aiming to with all its immense money printing fire power. While it’s the euro which has demanded so much from DXY that it almost seems plausible (to a few) this time, what’s the real big one still lurking out there have to say about all this?CNY.According to the People’s Bank of China (PBOC), the balance of foreign assets reported on...

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