China Dumps the Dollar

[Markinsa]

Starts @ 3:12

 

[Markinsa]

China tells state banks to prepare for a massive dollar dump and yuan buying spree as Beijing's prior interventions have failed to stem its currency's worst year since 1994

 

Phil Rosen 

Sep 29, 2022, 9:14 AM

 

 

 

• Reuters reported that China told state-owned banks to get ready to sell dollars and buy yuan in an effort to prop up the local currency. 
• The move could stem the yuan's fall, as it remains on track for its largest annual loss against the dollar since 1994. 
• A hawkish Fed has pushed the dollar to 20-year highs this year, pressuring currencies around the world. 

The People's Bank of China has told major state-run banks to prepare to shed dollar holdings while snapping up offshore yuan, which has continued to fall despite prior interventions, sources told Reuters.

 

The scale of this latest effort to prop up the yuan will be big and could provide a floor to the Chinese currency, according to the report.

 

The amount of dollars to be sold hasn't been decided yet, but Reuters said it will primarily involve the state banks' currency reserves. Their offshore branches, including those based in Hong Kong, New York and London, were ordered to review offshore yuan holdings and check to see that dollar reserves are ready. 

 

On Thursday, the yuan fell 0.9% to 7.1340 against the dollar and is on track for its worst annual decline since 1994, having lost more than 11% so far this year. Earlier this week, China's offshore yuan this week depreciated to a record-low against the greenback, and its domestic unit fell to its weakest level since the 2008 financial crisis.

 

The Federal Reserve's hawkish policy path has bolstered the dollar to 20-year highs this year, putting pressure on other central banks and triggering a "reverse currency war."

 

While a weaker currency can sometimes be beneficial, as it means exports get cheaper, the yuan's recent decline below the psychological threshold of 7-per-dollar has raised concerns. 

 

The People's Bank of China has consistently imposed a strong bias to its currency reference rate to help support the yuan. Central bank officials have also issued verbal warnings against speculating on the yuan and increased the cost of shorting the currency.

 

But it has refrained from raising benchmark rates and instead has been easing them in an effort to spark growth in an economy that's been dragged down by COVID-19 lockdowns, a real estate crash, and supply chain snags.

 

 

 

[coorslite21]

Double edged sword... 

These Countries will dump US treasuries because of a perceived value to help prop up their currency....Japan and Britain have as well....

 

Dollar goes up until it hits a tipping point....then it's Katie bar the door..  CL

[markb57]

it is years past time for the US to stop all foreign aid, military assistance and disaster aid to the world. It is always the US first in to assist and damn-it, it time to stop and take care of our own. Countries dumping the dollar need to get a bill from us for all the aid we've rendered over the decades.....

[keylime]

4 hours ago, markb57 said:

it is years past time for the US to stop all foreign aid, military assistance and disaster aid to the world. It is always the US first in to assist and damn-it, it time to stop and take care of our own. Countries dumping the dollar need to get a bill from us for all the aid we've rendered over the decades.....

I've been saying this for decades. My mom worked all her life and her SS hardly gets her to the end of the month, and if she tries to make money from a part time they bang out her assistance. Penalize her for trying to make ends meet. She was getting 16 dollars a month in food stamps. Meanwhile, all the fat cats in Congress give themselves raise after raise, insider trading, vote on insurance policies for themselves that we can't get, etc etc criminals....And then we turn around and give billions of our tax payer money to countries who hate us. Makes you want to blow up the whole system and start all over by leveling the playing field with the now trillions thrown away on everything else but taking care of our own by giving it back to us. The largest crooked business in the world is the US Government. Bastards all!!!!

[Markinsa]

The U.S. dollar might CRASH. Here's how YOU can prepare.

[pokerplayer]

Why don't you tell us how you really feel keylime  ? HA !

 

   pp

[keylime]

12 minutes ago, pokerplayer said:

Why don't you tell us how you really feel keylime  ? HA !

 

   pp

Nah. I might say something I regret. 😂

[yota691]

 

“THE VOLUME OF SALE WILL BE LARGE.” CHINESE BANKS ARE PREPARING TO SELL THE DOLLAR

 

Monday, October 3, 2022 5:41 PM

Follow-up / National News Center

The People's Bank of China (China's central bank) has asked major state-run banks to prepare to give up their dollar holdings as the overseas yuan weakens, Reuters reported.

In a report, the agency said that it had asked Chinese state banks to "request their overseas branches, including those in Hong Kong, New York and London, to review their yuan reserves and ensure that dollar reserves are ready to act."

The simultaneous selling of dollars and buying of the yuan could put a floor under the Chinese currency, which has lost more than 11% of its value against the dollar so far this year and appears to be heading for its biggest annual loss in 28 years since 1994. It has
not been determined how many dollars will be sold To support the Chinese currency, but one source reported that the size of this round of selling the dollar to defend the weak yuan will be large.
Although the yuan's exchange rate depreciation was gradual and in line with the decline of major currencies against the dollar, which is supported by the US Federal Reserve's tightening of its monetary policy, its decline to more than 7 yuan per dollar raised concerns about market sentiment in China and the possibility of capital flowing to the outside.
China spent about $1 trillion of its official foreign exchange reserves to prop up the currency after a one-time 2% devaluation in 2015 that roiled global financial markets.
Earlier last week, China's monetary authorities asked local banks to revive the yuan peg they abandoned two years ago as they sought to steer and defend the weak currency.

[MyLadiesDaddy]

This is a concerted effort by the largest Central Banks around the world to bring down the dollar and end America's hegemony.

 

When you become the Bully of the Playground expect everyone to gang up on you. 

 

By The way if you don't own some Silver and Gold you're about to get left out in the blizzard. 

[coorslite21]

2 hours ago, MyLadiesDaddy said:

This is a concerted effort by the largest Central Banks around the world to bring down the dollar and end America's hegemony.

 

When you become the Bully of the Playground expect everyone to gang up on you. 

 

By The way if you don't own some Silver and Gold you're about to get left out in the blizzard. 

 

Trending in Germany and the EU ..   "The US blew up the pipeline" ....almost like a declaration of war... 

 

By coincidence that same day an additional pipeline came online from the Scandinavian area....wonder who is financing that?

Clinton....Bush....Obama????

 

No matter....the US has cooked it's own goose!

CL