BY CHRIS POWELL · JANUARY 1, 2018
Death Spike for the Dollar Set for January 18? from GATA
TDC Note – Is this in retaliation to Venezuelan President Maduro announcing the new crypto “El Petro” would in fact be coming to market and in order for China to capture as much market share as possible and move people in the direction China wishes they need to bring this new contract to market a lot sooner than later?
If you recall, China delayed and delayed and delayed the opening of the Shanghai Gold Exchange. We were expecting a similar situation with the new yuan backed oil benchmark contract, but alias this is not going to be the case. All eyes on January 18. We don’t really see this as bringing about the death of the Federal Reserve Note but it is a significant blow in any light.
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By Sungwoo Park Bloomberg News Monday, January 1, 2018
China, the world’s biggest oil buyer, is on the verge of opening a domestic market to trade futures contracts. It’s been planning one for years, only to encounter delays. The Shanghai International Energy Exchange, a unit of Shanghai Futures Exchange, will be known by the acronym INE and will allow Chinese buyers to lock in oil prices and pay in local currency. Also, foreign traders will be allowed to invest — a first for China’s commodities markets — because the exchange is registered in Shanghai’s free trade zone.
There are implications for the U.S. dollar’s well-established role as the global currency of the oil market.
According to the Shanghai-based news portal Jiemian, which cited an unidentified person from a futures company, trading is expected to start Jan. 18. Multiple rounds of testing have been carried out and all listing requirements met. …
Futures trading would wrest some control over pricing from the main international benchmarks, which are based on dollars. Denominating oil contracts in yuan would promote the use of China’s currency in global trade, one of the country’s key long-term goals. And China would benefit from having a benchmark that reflects the grades of oil that are mostly consumed by local refineries and differ from those underpinning Western contracts. …
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