Three gold bricks hit US dollar: throwing US debt, buying IMF debt, renminbi settlement

Summary: In tandem with the BRICS summit, the dollar has been heavily hit by the BRICS: U.S. Treasury bonds were collectively reduced by China, Russia and other major holders, with China, Russia and Brazil announcing their purchases of IMF bonds in the hope of resisting the risk of dollar assets and expanding their voice, according to data released 15th by the U.S.　　At the same time, a growing number of countries are considering using the renminbi as a bilateral trade settlement currency; the UBS survey shows that "some Asian currency" is most likely to be the reserve currency that challenges the dominance of the dollar. In tandem with the BRICS summit, the dollar has been heavily hit by the BRICS: U.S. Treasury bonds were collectively reduced by China, Russia and other major holders, with China, Russia and Brazil announcing their purchases of IMF bonds in the hope of resisting the risk of dollar assets and expanding their voice, according to data released 15th by the U.S.　　At the same time, a growing number of countries are considering using the renminbi as a bilateral trade settlement currency; the UBS survey shows that "some Asian currency" is most likely to be the reserve currency that challenges the dominance of the dollar. But because the interests of all countries have been tied to the U.S. dollar, analysis that in the short term, both the reduction of U.S. Treasury bonds and dare not throw, both "hit" The dollar and can not be fully suppressed, is the BRICS dilemma, the dollar status will remain.　　The renminbi continues to rise and is expected to start to rival the dollar in 10 years. On the eve of the 1 Group reduction Summit, countries have started to reduce their holdings of US Treasuries collectively, the first "BRIC" to hit the dollar (Figure 1, 2).　　According to the US Treasury 15th, 7 of the top 8 major holders of U.S. Treasuries have a total reduction in US Treasuries. By the end of April, China had held $763.5 billion trillion in U.S. Treasuries, reducing its holdings by 4.4 billion U.S. dollars in late March, its first reduction since February 2008. In April, Russia reduced its total holdings of $1.4 billion trillion in U.S. Treasuries, which ranked fifth in the U.S. Treasury Holdings, to sixth place.　　Brazil's reduction is $600 million trillion.　　In addition, Japan, with a small reduction of $800 million trillion, continues to be the second largest holder of US Treasuries with a 685.9 billion dollar holdings, and the Caribbean coast countries and oil exporters have continued to rank third and fourth, respectively, by reducing their holdings of $8.9 billion and $2.5 billion. Data show that the United States April net foreign capital outflow amounted to 53.2 billion U.S. dollars. In long-term securities, foreign investors are net buyers of us-medium-term bonds at $41.9 billion trillion, below March's $56.4 billion trillion.　　In addition, overseas investors sold $2.5 billion trillion of U.S. government support Agency bonds, net buy U.S. stocks 4.6 billion U.S. dollars, net selling US corporate bonds 9.7 billion U.S. dollars. Not only that, the surge in US Treasuries may have just begun, and will then be reduced more. Ulukayev, the first vice president of the Russian Central bank, said June 10 in Moscow that Russia accounts for more than 30%, the equivalent of 140 billion U.S. dollars in foreign exchange and gold reserves are U.S. Treasury bonds, the future share may be reduced.　　Russia plans to gradually replace its holdings of U.S. and other sovereign bonds with other financial instruments. UBS heldThe outcome of the 15th Annual Symposium on the management of reserve assets of sovereign institutions has also revealed the decline of US Treasuries.　　The seminar was the largest unofficial annual gathering of reserve asset managers, multilateral institutions and sovereign wealth funds in the central bank, and participants were not convinced that the US economy was beginning to bottom up and were generally concerned about the yield on US Treasuries. 2 CMB to buy IM f bonds to reduce the next step in the U.S. Treasury bonds is to buy im f bonds.　　At present, China, Brazil, Russia and other countries have openly expressed this intention. On June 5, China's State administration of foreign exchange said it was "actively considering" buying up to 50 billion dollars in International Monetary Fund (IM) bonds to help finance Im F. Im F First Deputy director Lipsky confirmed China's proposal and said im F "absolutely welcome".　　It is reported that IM f at least need to raise 500 billion dollars of money. To this end, IM F began to actively prepare to issue bonds. June 8, Im F CEO Strauss Karn said: "If the IM-F Council agrees, then it will be possible to issue bonds on demand." When asked if the bond was tradable, he replied "yes".　　It is understood that such bonds will be mainly limited to central bank transactions. Then, 10th, the first deputy governor of the Russian Central Bank, Ulukayev said that if the fourth quarter of this year IM f issuance of bonds, then the Russian plan to use gold and foreign exchange reserves to participate in the purchase, the total contribution of up to 10 billion U.S. dollars.　　Russian official statistics show that as of June 1, Russia's foreign exchange and gold reserves of about 404 billion U.S. dollars. On the same day, Brazilian finance Minister Mantega said Brazil would buy $10 billion of IM F bonds for the first time as the organization's creditor country.　　Brazil's existing foreign exchange reserves are 200 billion dollars. In addition, Mantega said another BRIC member ——— India may also announce similar moves.　　It is speculated that India is likely to buy an IM F bond that is close to the amount promised by Brazil and Russia. It is understood that the IMF wants to issue bonds in the form of special Drawing Rights (SD R), which is an internal account of the agency, consisting of a basket of representative currencies, including the dollar and the yen. The purchase of SD R will help China's reserve powers withstand the risk of asset shrinkage caused by the depreciation of the dollar. And the BRICS can have a bigger say in Im F.　　Both China and Russia have shown this frankly. Notably, the SDR is the "quasi-international currency" previously proposed by China's central bank governor, Zhou Xiaochuan, to replace the dollar. If the Brics ' voice in IM f is strengthened, it will affect the composition of the "quasi-international currency" and the dollar's share is likely to fall.　　This became the second "BRIC" to hit the dollar. 3 Bilateral trade settlement abandon US dollar if the U.S. Treasury bonds can only be partially reduced, not all, the BRICS bilateral trade settlement may be the first to completely abandon the dollar. As a hit to the dollarThe third piece of "Bric", the measure has already begun. In May, Brazil's president Lula's large delegation visited China and Brazil for the first time to explore the use of the renminbi and the Brazilian real to replace the dollar as a trade currency.　　Although Russia, India has not yet made a statement, but China, Russia, China and India bilateral trade is huge, the abandonment of the dollar as a third party currency, both sides of the trade can reduce foreign exchange risk. Malaysian Prime Minister Najib said that not only does Malaysia consider using the renminbi and ringgit to settle bilateral trade, but more and more countries are considering not using the dollar as a trade settlement currency.　　April 29, in an interview with this newspaper, the New Zealand Consul General and commercial counsellor in Guangzhou said that they would like to use the renminbi for bilateral trade settlement.　　Moody's published a report earlier this month, noting that China's economic clout is growing and that it is an important trading partner for many countries, and that the US is worried about the depreciation of its national debt, and it is expected that more and more bilateral trade will be used in the renminbi. The dilemma of the 4 BRIC countries and the renminbi's advance in the "BRIC" hit, the dollar's status will fall? Perhaps, it depends on whether the dollar itself remains firm. Worries about the dollar's depreciation have been long and recent, thanks to America's high deficit and the government's bailout plan to open money-printing presses.　　In the past 3 months, the Brazilian currency has actually appreciated by 20% against the dollar, the Russian rouble up 13% and the Indian rupee by 10%. The Congressional Budget Department said the U.S. fiscal deficit is expected to rise to $455 billion trillion from last year's current year September 30. Under these circumstances, the dollar's strength is hard to sustain.　　But because multinational interests, including the BRICS, are in fact tied to the dollar, the dollar will remain in place for a short time. Currently, the Brics have a total of $2.8 trillion trillion in foreign exchange reserves and hold most of US Treasuries. If the dollar falls sharply, the first BRIC countries will suffer. That is why the four countries are cautious about suppressing the dollar. In the days after Russian President Dmitry Medvedev proposed that "the world needs more reserve currencies", the Russian Finance minister, Mr Kudrin, said the dollar was "in good shape" and added that the dollar was no substitute for the global reserve currency. Brazil's finance minister also stressed that it did not deliberately suppress the dollar.　　China has also repeatedly said that the BRIC countries are not going to abandon the dollar, such a reference is unrealistic. As a result, it is now a dilemma for BRIC countries to reduce their holdings of treasuries and not to throw them out, "smashing" the dollar and not trying to suppress it.　　Zhang Ming, Secretary-General of the International Financial Research Center of the Chinese Academy of Social Sciences, analyses that the BRICS summit is more about signalling, putting the dollar under pressure, and making it harder to achieve real action. In the above complex situation, the renminbi is expected to rise. The euro is behind "some Asian currency" when it is most likely to challenge the dollar's dominance of the global reserve currency, at the 15th annual "Sovereign Reserve Asset Management Symposium" held by UBS. To the United StatesConfidence in the yuan as the most important reserve currency is also falling, and its vote rate has fallen by 7% this year, while gold and other currencies (including the special Drawing rights proposed this year) have risen (Figure 3, 4). June 6, Russia's finance minister, Mr. Kudrin, said the renminbi is expected to become the world's reserve currency for the next decade, despite the affirmation that the dollar is "no substitute". "I think the quickest way is for China to open its economy and allow the renminbi to be freely convertible," he said. "It could take ten years." But then there will be demand for the renminbi, and the shortest way to create a new global reserve currency. "Newspaper reporter Sinling