Ending dollar dominance in world market | Updates

[Muhammed45]

Iran & China seek to eliminate US dollar from bilateral trade
Published time: 5 Dec, 2017 12:57
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© Thomas White / Reuters
Iran suggests Russia help ‘isolate the Americans’ by ditching dollar
“Rial-yuan’s bilateral monetary agreement can have a significant role in increasing the volume of trade between the two countries and in this regard, we have conducted a series of negotiations with the central bank of the Republic of China’s president,” said the Central Bank of Iran’s Governor Valiollah Seif.

Tehran has been pursuing the goal of eliminating the dollar in its trade, and has been trying to sign currency swap agreements with a few target countries.

Chen said that Iran and China should develop their banking links and also underlined the unfairness of the existing financial system, dominated by a few developed countries. He added, other nations would do better if the unfair system is eliminated.

“We could use the experiences of European countries in establishing the euro as a common currency between many countries, which is not exclusively controlled by a single country. But until then, we need to utilize the maximum available capacities to expand our banking relations,” he was quoted as saying by the Iranian daily.

However, any such initiatives require time and effort by several countries, the Chinese official said.


https://www.rt.com/business/411984-china-iran-us-dollar/

 

[Muhammed45]

Russia-China real gold standard spells death for US dollar
Published time: 9 Dec, 2017 06:29Edited time: 9 Dec, 2017 09:01
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© Ilya Naymushin / Reuters


The BRICS counties are considering starting an internal gold trading platform, according to Russian officials. When this happens, the global economy will be significantly reshaped, and the West will lose its dominance, predicts a precious metals expert.
In 2016, 24,338 tons of physical gold were traded, which was 43 percent more than in 2015, according to Claudio Grass, of Precious Metal Advisory Switzerland.

Read more
‘Gold price will explode & dollar get wiped out’ – warns investor Peter Schiff

Gold moving from the West to the East

“We have to put the BRICS initiative into a broader context. It is just part of a geopolitical tectonic shift which started decades ago. We have seen a constant outflow of physical gold from the West to the East. At the same time, the West has lost the economic war, and as a consequence, the focus now turns to the financial system. China dominates the world economy and has displaced the US as the world’s most formidable economic powerhouse,” he told RT.

The creation of a new gold standard by BRICS is also a step to end the US dollar’s domination of the global economy

“As Bejing and Moscow understand that America used the dollar to control the world, by implementing a new kind of ‘Gold standard 2.0’ they want to distance themselves from this control. Furthermore, the vast majority of the people in Asia sees gold as superior, or ‘real’ money, something the West has forgotten, because of all the paper wealth (credit) they have accumulated,” said Grass.

The expert notes the BRICS countries account for 40 percent of the world’s population and around 23 percent of the world’s domestic product.

"In combination with the announcement of pricing oil in yuan, using a gold-backed futures contract in Shanghai, the establishment of the Asian Infrastructure Investment Bank and the New Development Bank, China is setting up an alternative to the post-Bretton Woods establishment. This is certainly a game changer,” said Grass.

Read more
Russia & China could set international gold price based on physical gold trading

Physically backed precious metals market spells the end of paper gold trade

The level of trust between BRICS countries can help them establish intragroup gold trading, which would be 100 percent physically backed.

“This will present a viable challenger that could over time lead to a break up of the current system since the West will likely still trade paper gold in the meantime,” Grass said.

According to London gold clearing statistics for 2016, the total trading volume in the London Over-the-Counter (OTC) gold market is estimated at the equivalent of 1.5 million tons of gold. The volume of 100oz gold futures on New York's COMEX reached 57.5 million contracts during 2016 or 179,000 tonnes of gold, the analyst notes.

The amount of mined gold is much smaller

“If we now take into consideration that only approximately 180,000 tons of gold have actually been mined up to today the scam is just gigantic and obviously unsustainable. The paper scams in London and New York will either blow up when the paper price of gold drops to zero or when just a fraction of investors insists upon receiving physical gold in return,” Grass said.

The expert believes that with paper gold trading, the established gold exchanges could cease to exist sooner or later.

“They will likely become obsolete and lose their importance over time. Although one cannot predict exactly how fast this will happen, the trend is clear: OTC and COMEX are working toward their own destruction,” he said.

Read more
Russia continues stocking up on gold under Putin’s strategy

Gold prices could explode if trading were backed by physical precious metals

“It will definitely lead to higher prices for physical gold. Imagine if you could buy on COMEX and OTC gold at a much lower price and still have the option to sell it in Asia for a much higher price; this would kill the old paper scams immediately. Therefore, I would guess that both could come up with new restrictions that only cash settlements will be allowed to avoid this. We know for example that even today 99.96 percent of COMEX gold futures are settled in cash,” Grass wrote.

The final battle: Gold vs. US dollar

The analyst recollected the Heartland Theory of Halford Mackinder, a British geostrategist at the beginning of the 20th century who influenced the likes of Kissinger and Brzezinski. Following the theory, we will soon face a war between physical gold and the US dollar.

“As per my understanding, we are moving into the final phase, the battle between currencies – one that will be backed by a hard asset which was real money since time immemorial until 1971 and the other one, backed by promises that future generations will pay through debt, inflation and ever-rising taxation,” he said.

Getting away from fiat currencies will be good for gold

“I would like to conclude with a final thought from my friend Jayant Bandari: the combination of negative yields, massive political risks around the world, and any attempt to move away from traditional currencies will be positive for gold and will take it to the next level. Investing is very much linked with geopolitics - once you understand the big picture, it becomes apparent what you should invest in,” Grass told RT.



https://www.rt.com/business/412546-china-russia-gold-standard-dollar/

 

[Muhammed45]

Russia-China real gold standard means end of US dollar dominance
Published time: 9 Dec, 2017 06:29Edited time: 9 Dec, 2017 09:19
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© Ilya Naymushin / Reuters
‘Gold price will explode & dollar get wiped out’ – warns investor Peter Schiff
Gold moving from the West to the East

“We have to put the BRICS initiative into a broader context. It is just part of a geopolitical tectonic shift which started decades ago. We have seen a constant outflow of physical gold from the West to the East. At the same time, the West has lost the economic war, and as a consequence, the focus now turns to the financial system. China dominates the world economy and has displaced the US as the world’s most formidable economic powerhouse,” he told RT.

The creation of a new gold standard by BRICS is also a step to end the US dollar’s domination of the global economy

“As Bejing and Moscow understand that America used the dollar to control the world, by implementing a new kind of ‘Gold standard 2.0’ they want to distance themselves from this control. Furthermore, the vast majority of the people in Asia sees gold as superior, or ‘real’ money, something the West has forgotten, because of all the paper wealth (credit) they have accumulated,” said Grass.

The expert notes the BRICS countries account for 40 percent of the world’s population and around 23 percent of the world’s domestic product.

"In combination with the announcement of pricing oil in yuan, using a gold-backed futures contract in Shanghai, the establishment of the Asian Infrastructure Investment Bank and the New Development Bank, China is setting up an alternative to the post-Bretton Woods establishment. This is certainly a game changer,” said Grass.

Read more
Russia & China could set international gold price based on physical gold trading
Physically backed precious metals market spells the end of paper gold trade

The level of trust between BRICS countries can help them establish intragroup gold trading, which would be 100 percent physically backed.

“This will present a viable challenger that could over time lead to a break up of the current system since the West will likely still trade paper gold in the meantime,” Grass said.

According to London gold clearing statistics for 2016, the total trading volume in the London Over-the-Counter (OTC) gold market is estimated at the equivalent of 1.5 million tons of gold. The volume of 100oz gold futures on New York's COMEX reached 57.5 million contracts during 2016 or 179,000 tonnes of gold, the analyst notes.

The amount of mined gold is much smaller

“If we now take into consideration that only approximately 180,000 tons of gold have actually been mined up to today the scam is just gigantic and obviously unsustainable. The paper scams in London and New York will either blow up when the paper price of gold drops to zero or when just a fraction of investors insists upon receiving physical gold in return,” Grass said.

The expert believes that with paper gold trading, the established gold exchanges could cease to exist sooner or later.

“They will likely become obsolete and lose their importance over time. Although one cannot predict exactly how fast this will happen, the trend is clear: OTC and COMEX are working toward their own destruction,” he said.

Read more
Russia continues stocking up on gold under Putin’s strategy
Gold prices could explode if trading were backed by physical precious metals

“It will definitely lead to higher prices for physical gold. Imagine if you could buy on COMEX and OTC gold at a much lower price and still have the option to sell it in Asia for a much higher price; this would kill the old paper scams immediately. Therefore, I would guess that both could come up with new restrictions that only cash settlements will be allowed to avoid this. We know for example that even today 99.96 percent of COMEX gold futures are settled in cash,” Grass wrote.

The final battle: Gold vs. US dollar

The analyst recollected the Heartland Theory of Halford Mackinder, a British geostrategist at the beginning of the 20th century who influenced the likes of Kissinger and Brzezinski. Following the theory, we will soon face a war between physical gold and the US dollar.

“As per my understanding, we are moving into the final phase, the battle between currencies – one that will be backed by a hard asset which was real money since time immemorial until 1971 and the other one, backed by promises that future generations will pay through debt, inflation and ever-rising taxation,” he said.

Getting away from fiat currencies will be good for gold

“I would like to conclude with a final thought from my friend Jayant Bandari: the combination of negative yields, massive political risks around the world, and any attempt to move away from traditional currencies will be positive for gold and will take it to the next level. Investing is very much linked with geopolitics - once you understand the big picture, it becomes apparent what you should invest in,” Grass told RT.

 

[Muhammed45]

Dollar's days as world’s most important currency are numbered – Berkeley economics professor
Published time: 12 Dec, 2017 14:32
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© Thomas White / Reuters

Currencies will soon coexist on a more ‘equal footing’ in international markets, and the US dollar will be forced to share prominence with the Chinese yuan and the EU’s euro, according to global currency systems expert Barry Eichengreen.
In his book How Global Currencies Work: Past, Present, and Future, he wrote that reserve currences can and do coexist. The book, co-authored by European Central Bank economists Arnaud Mehl and Livia Chițu, was published this month.

"The US Dollar Dominates Global Finance -- But for How Much Longer?" https://t.co/jPt0GvDs9i At _Prospect Magazine_ here. (In support of _How Global Currencies Work_ https://t.co/k9lsxJbSIX

— Barry Eichengreen (@B_Eichengreen) November 22, 2017
The economists used new evidence of central bank reserves from the 1910s to early 1970s, mainly focusing on the interwar period of the 1920s and 1930s. They have challenged the traditional ‘winner-take-all’ view that there can only be one dominant reserve currency at a time.

“In the period between the wars, it seems the British pound and the US dollar shared reserve currency status more or less equally, depending on the year,” said Eichengreen and his colleagues. They found that “before the First World War, even though sterling was the most important currency, the French franc and German mark were internationally significant, too.”

Read more
Bitcoin crushing US dollar & governments can do nothing to stop it - Max Keiser
According to the economists, “From this vantage point, it is the second half of the 20th century that is the anomaly, when an absence of alternatives allowed the dollar to come closer to monopolizing this international currency role.”

Eichengreen, who’s an economics professor at the University of California, Berkeley, said the dollar’s days as the dominant reserve currency will end “sooner rather than later” and the speed of the shift might depend on the actions of US President Donald Trump.

He said some experts suggest the Chinese yuan is destined to lead in the future.

“The traditional view is that international currency status is a winner-take-all game, that there’s room on the global stage for only one true international currency. The argument was that network effects are so strong they create a natural monopoly because it pays to use the same currency in cross-border transactions that everybody else has used,” Eichengreen told the Quartz.

However, the “new view is that financial technology has moved on and network effects are no longer so strong.”

“It’s easier to switch between currencies. It’s similar to how operating systems for personal electronics have transformed. Everyone doesn’t have to use Windows anymore,” said the economist.


https://www.rt.com/business/412861-us-dollar-days-numbered/

 

[Muhammed45]

China about to knock out petrodollar by trading oil in yuan
Published time: 14 Dec, 2017 10:20
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John Ryder knocks out Patrick Nielsen © Andrew Couldridge / Reuters

As one of the world’s top energy importers, China has successfully completed its fifth dry run in yuan-backed oil futures contract trading. The step has been already called Beijing’s challenge to the US dollar.


Read more
China's launch of 'petro-yuan' in two months sounds death knell for dollar's dominance
According to Bloomberg, which cited a statement from the exchange, 149 members of Shanghai International Energy Exchange traded 647,930 lots in the rehearsal with a total value of 268.2 billion yuan. The system met the listing requirements of crude futures after the exercise, it added.

“This contract has the potential to greatly help China’s push for yuan internationalization,” said Yao Wei, chief China economist at Societe Generale in Paris.

She added, however, “its success will hinge critically on the degree of freedom allowed for the capital flows related to the contract.”

A former China division chief at the International Monetary Fund, Eswar Prasad said: “It is not unreasonable to envision a world in which the overwhelming share of commodity contracts, especially for oil, are no longer denominated just in dollars.”

But “the yuan’s role in global finance will ultimately be determined by the degree of commitment of Xi Jinping’s government to economic and financial market reforms.”

Since the 1970s, the global oil trade has almost entirely been conducted in US dollars. The largest energy consumer, China, is interested in having oil contracts in yuan. Beijing plans to introduce its own oil benchmark which will rival Brent or West Texas Intermediate. Analysts say Chinese authorities will need to first convince large oil producers and consumers to use the yuan and invest in the Shanghai benchmark.


RT

✔@RT_com

Venezuela ditches dollar for oil payments to dodge US penalties https://on.rt.com/8n6l

2:50 PM - Sep 14, 2017

Venezuela ditches dollar for oil payments to dodge US penalties — RT Business News
Caracas has ordered oil traders to convert crude oil contracts into euro and not to pay or be paid in US dollars anymore, according to sources close to the matter as quoted by WSJ. The measure is...

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The Chinese government announced plans to start a crude oil futures contract priced in yuan and convertible into gold earlier this year. The contract will enable the country's trading partners to pay with gold or to convert yuan into gold without the necessity to keep money in Chinese assets or turn it into US dollars.

The new benchmark will reportedly allow exporters, such as Russia, Iran or Venezuela to avoid US sanctions by trading oil in yuan.

In September, Venezuela ditched the greenback for oil payments. Caracas has ordered oil traders to convert crude oil contracts into euro and not to pay or be paid in US dollars anymore. The measure followed the rolling out of sanctions by the United States against the country.


https://www.rt.com/business/413107-petro-yuan-futures-trading/

 

[Muhammed45]

https://defence.pk/pdf/threads/good...and-china-dump-us-treasuries-buy-gold.477212/

 

[LeGenD]

Do people understand that how China is going to keep the prices of its products low in both domestic and international markets, if value of Yuan significantly appreciate in exchange?

FYI: https://www.bloomberg.com/news/arti...how-hurdles-confronting-china-s-currency-push

A de-valued Yuan favors Chinese exports.

Economics is a cruel thing. Something has to give in place of another objective.

And currency wars do not necesarily yield desirable outcomes. You can bet your house on the fact that US will counter and retaliate.

Hint for the wise: the world was in Great Depression before WW2.

 

[Muhammed45]

Pakistan considers dumping dollar for yuan in trade with China
Published time: 19 Dec, 2017 10:00
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© Global Look Press
https://t.co/IwJCBOoCYdpic.twitter.com/mnZNLnMI5y

— RT (@RT_com) December 18, 2017
Bilateral trade between Pakistan and China was worth $13.8 billion in 2015 to 2016, a decade after the countries signed a free trade agreement. Pakistan will continue to use the rupee domestically, according to Iqbal.

The LTP includes cooperation between the countries in energy, information network infrastructure, road and rail connections, trade and industrial parks, tourism, agriculture, and poverty alleviation. The plan will be implemented in three phases, the first ending in 2020, followed by another in 2025, with completion in 2030.



Iran & China seek to throw US dollar out of bilateral trade https://t.co/6NrjiBQnTJpic.twitter.com/XW2Yvqs6Sj

— RT (@RT_com) December 5, 2017
Under the plan, the countries intend to develop multi-level cooperation and strengthen policy coordination, as well as establish and improve the cross-border credit system and financial services. Karachi and Beijing are also planning to enhance currency swap arrangements and create a bilateral payment and settlement system.

China set to roll out petro-yuan before year end, dollar dominance demise looms? https://t.co/TiaiXjIB0Npic.twitter.com/iqmm0FRvKr

— RT (@RT_com) October 28, 2017
Earlier this year, China pledged to invest $57 billion in Pakistan to fund the CPEC project as part of its “Belt and Road” initiative, which aims to build a ‘New Silk Road’ of land and sea trade routes across more than 60 countries in Asia, Europe, and Africa.


https://www.rt.com/business/413608-pakistan-chinese-yuan-bilateral-trade/

Do people understand that how China is going to keep the prices of its products low in both domestic and international markets, if value of Yuan significantly appreciate in exchange?

FYI: https://www.bloomberg.com/news/arti...how-hurdles-confronting-china-s-currency-push

A de-valued Yuan favors Chinese exports.

Economics is a cruel thing. Something has to give in place of another objective.

And currency wars do not necesarily yield desirable outcomes. You can bet your house on the fact that US will counter and retaliate.

Hint for the wise: the world was in Great Depression before WW2.

Consider that USA cannot fight against the whole world.

If south Americans, Asians and Africans wants to get rid of dollar and sanctions, except for US lackeys, this bully cannot dictate her inflation on others with forcing them to buy dollar as their backing currency.

The real supporter for national currencies should be based on gold. Gold is the true choice to back the currencies, and dont be worried about US whining all the time. A sinking swimmer will stick to anything around to save herself, just get away from it and watch it's death

 

[LeGenD]

Consider that USA cannot fight against the whole world.

If south Americans, Asians and Africans wants to get rid of dollar and sanctions, except for US lackeys, this bully cannot dictate her inflation on others with forcing them to buy dollar as their backing currency.

The real supporter for national currencies should be based on gold. Gold is the true choice to back the currencies, and dont be worried about US whining all the time. A sinking swimmer will stick to anything around to save herself, just get away from it and watch it's death

It takes one powerful country to start world war.

Sensational headings of RT notwithstanding; your grasp of economics is terrible.

These are the global reserve currencies:

• U.S. dollar
• Euro
• Chinese renminbi*
• Japanese yen
• Pound sterling
• Australian dollar
• Canadian dollar
• Swiss franc

*Also known as Yuan; global reserve currency status approved by IMF in 2015

What you need to understand is the fact that China and Russia cannot dump USD [in its entirety] in trade because they have many trading partners and not just each other; no country can. US is not only the 2nd largest economy in the world but is also the largest trading partner of China and scores of other countries. This reality is unlikely to change anytime soon because Americans are rich on average and US will remain one of the largest markets in the world in the foreseeable future. In-fact, American markets create DEMAND for the entire world.

You understand the DEMAND-SUPPLY fundamental of economy?

US = DEMAND in large part
China = SUPPLY in large part

What is happening that Chinese state has relaxed the criteria for trading in Yuan recently; this has enabled scores of countries to conduct trade with Chinese companies in Yuan consequently, and not necessarily in US dollar. As Chinese Yuan will float more, chances are that China will have to [allow] foreign markets to determine the value of Yuan which is the case with majority of currencies in the world (earlier, The People's Bank of China used to fix the value of Yuan for exchange in foreign markets; an artificial mechanism which led to accusations of currency manipulation from other countries*).

*Recall these accusations from Donald Trump? And recall the visit of Chinese premier to the US afterwards?

So China is doing exactly what IMF is expecting from it. And here I see baseless sensational speculations about the impending demise of US dollar. Not going to happen as long as US remains one of the largest markets in the world.

Many countries can choose to conduct trade with China in Yuan but they cannot force US to embrace Yuan for the same. Most of the countries will have to conduct trade with US in US dollar because the latter won't oblige otherwise and nobody wants to risk loosing access to American markets. Keep in mind that American companies can fulfill the demands of American markets, if they have to.

Another problem is that if US chooses to isolate itself in the matters of trade, this move will bring about great depression all over the world [like in 1930s] and this is BAD NEWS for majority of the countries (China included). So US [cannot be allowed to] isolate itself in the matters of economics.

Global reserve currencies make it convenient for all to conduct trade because it is impractical to conduct trade with every currency out there. And global reserve currencies belong to world's largest economies (see the list above). Since China is arguably the largest economy in the world at present, it was only a matter of time that Yuan would become a global reserve currency.

Now keep in mind that Yuan being a global reserve currency is a double-edged sword for Chinese economy in reality. If value of Yuan appreciates significantly in the foreign markets, Chinese goods will become expensive and loose their competitive advantage accordingly. This development can affect Chinese exports. Conversely, competition will be FAIR and cheap Chinese goods will not have undue advantage in prices.

As far as gold reserves are concerned; should paper currency [ever] loose its monetary importance, gold reserves will come into play. Traditionally, trading has been conducted in exchange of gold, silver and goods.

 

[Divergent]

Keep an eye out out for Russia and China - these are the big boys to roll with.

 

[Muhammed45]

Russia & China to kneecap petrodollar in 2018 predicts Saxo Bank
Published time: 23 Dec, 2017 13:46
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© Jason Lee / Reuters

The world’s largest crude oil importer China is likely to roll out the petro-yuan next year predicts Saxo Bank. Beijing’s largest oil supplier Russia would gladly accept the yuan to phase out the dollar in trade with China.

Read more
China's launch of 'petro-yuan' in two months sounds death knell for dollar's dominance
“China is by far the world’s largest oil importer, and many producer nations are already more than happy to transact in yuan terms. With the US’ global power and reach waning, and given the success of CNY-based commodity futures in general, the Shanghai International Energy Exchange’s decision to launch a yuan-based crude oil future is a runaway success,” reads one of Saxo’s ‘outrageous’ predictions for 2018.

Saxo Bank expects the Chinese yuan-denominated oil contract to be “a move with tremendous geopolitical and financial consequences.”

The US West Texas Intermediate and European benchmark Brent have a joint daily turnover of more than two billion barrels or 20 times the total daily world oil demand. However, the US WTI oil standard is losing its role in the oil market, notes Saxo.

“China, meanwhile, has already become far and away the world’s largest crude oil importer and many key exporters – led by Iran and Russia – are more than happy to transact in yuan terms,” the bank’s analysts conclude.

Saxo expects the Chinese oil contract to become “a raging success,” while the yuan is set to appreciate 10 percent against the dollar, taking the dollar-yuan exchange rate below 6.0 for the first time.
https://www.rt.com/business/414061-china-russia-oil-dollar-yuan/

 

[Muhammed45]

Russia-China combined gold reserves could shake US dominance in global economy - expert tells RT
Published time: 8 Jan, 2018 07:19
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Vladimir Putin holds a gold bar while visiting the Central Depository of the Bank of Russia © Alexsey Druginyn / AFP

The gold accumulated by China and Russia could be seen as part of a strategy to move away from international trade denominated in US dollars, according to Singapore’s BullionStar precious metals expert Ronan Manly.
Manly exclusively told RT that there is a shift occurring regarding the two countries building up their gold reserves, to perhaps returning to gold-backed currencies in the future and a move away from the global dominance of the US dollar, which is no longer supported by gold.

'West to lose its dominance': #BRICS may start physical gold trade https://t.co/avFLsNoRL8pic.twitter.com/kyi2gjPtTW

— RT (@RT_com) December 11, 2017
“China and Russia have both been aggressively accumulating their official gold reserves over the last 10 - 15 years,” he said, adding that only a decade ago each of them held around or less than 400 tons. “But now both these nations hold a combined 3670 tons of gold.”

“Interestingly, both Russia and China publicize and promote their accumulations of gold and publicly refer to gold as a strategic monetary asset. They make no secret of this. But on the flipside, the US does the opposite, and constantly downplays the strategic role of gold.”

According to Manly, for Russia and China gold is the only strategic monetary asset that could provide independence from the US dollar.

Manly said the sides could conceivably be holding a lot more gold than they declare in their official reserves due to many channels through which they could buy the precious metal.

China claims discovery of its largest gold mine with $22 billion potential https://t.co/DU2Fb6vsS6pic.twitter.com/WCMiazmzOI

— RT (@RT_com) March 30, 2017
“If China and Russia combined showed that they held more gold on a combined basis than the US, this would, even symbolically, be a blow to the US dollar and to the position of the US in the global economy,” the expert concluded.

For more stories on economy & finance visit RT's business section


https://www.rt.com/business/415251-russia-china-gold-us/

 

[xyxmt]

Another meaningless thread about the collapse -- actually, a wish -- of US dollar. If may happen, or it may not happen. Even if China overtakes US economically, doesn't mean the collapse of the US dollar. But it's nice to have dreams.

most people still dont understand what it means, it does not mean that US dollar will go down and collapse. But, what i means that US dominance on international trade will be over...US wont be able to sanction countries because there will be an alternate route.

 

[Muhammed45]

New global gold standard in kilobar may soon be coming
Published time: 24 Jan, 2018 11:26Edited time: 24 Jan, 2018 11:30
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© Frank May / Global Look Press
The World Gold Council (WGC) is considering a global standard for 1 kilogram gold bars so they could be used as collateral in futures markets and potentially encourage demand.
People close to the matter told Reuters the aim is to include companies from the world of gold refining, banks and brokers that trade the precious metal in the futures and physical markets, and the London Bullion Market Association (LBMA).

Read more
Paper gold trading days for London & New York numbered
“The plan is to create a standard for kilobars that can be adopted around the world, delivered anywhere, possibly using blockchain to identify the bars, their origins,” a physical gold trading source said. “Rigid standards and blockchain would bring in people who are worried they could be getting conflict metal.”

The kilobar measure dominates Asian trade as gold contracts on the Shanghai Gold Exchange, Shanghai Futures Exchange, and Hong Kong Exchanges and Clearing are all in kilobars.

However, lack of transparency about their origin and the absence of a global standard thwart their use on exchanges elsewhere. They cannot be accepted at London Metal Exchange clearing arm LME Clear because they differ from its standard bars which are typically around 400 ounces.

According to sources’ estimates, top consumer China imports about 95 percent of gold in kilobars, while second-largest consumer India imports 80 percent in kilobars. The WGC estimated China’s 2017 gold demand at up to 1,000 tons and India’s at 650 tons.

“The Asian consumer market is in kilobars, it dominates gold trade,” a gold industry source said. “If you want to trade on the LME and you want to lodge your collateral in kilobars in another location, why shouldn’t you be able to? There are vaults all over the world.”

#Gold ignores #cryptocurrency craze having its best year since 2010 https://t.co/FjYV1H0RElpic.twitter.com/FtwvukQnb4

— RT (@RT_com) December 30, 2017
Some refiners worry the global kilobar standard will lead to losses of income, others say it will boost the market.

“You can add a lot of information with blockchain, where the gold was mined, where it was refined, serial numbers, who owned it previously. It could bring new demand to the market,” a physical market source said.

For more stories on economy & finance visit RT's business section


https://www.rt.com/business/416838-gold-kilobars-standard-coming/

 

[Muhammed45]

Investors dump US dollar & rush to gold
Published time: 25 Jan, 2018 14:05Edited time: 25 Jan, 2018 14:11
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© Eddie Mulholland / Global Look Press

• 873

The gold price rose to its highest level in more than a year on Thursday as investors seek a safe haven after the US dollar dipped to a three-year low against a basket of six major currencies.
The precious metal rose as high as $1,370 during the trading session before dropping six dollars, but still trading in the green compared to the previous session. The 2016 high was $1,374.91.

Read more
Putin says dump the dollar
“Gold is benefiting tremendously from the weaker dollar,” said ETF Securities analyst Nitesh Shah, as quoted by Reuters.

“With traders' base case scenario to sell the dollar at all costs, gold prices should remain well supported on dips and could be poised to move even higher on the next US dollar wobble,” said Stephen Innes, APAC head of trading at OANDA.

The US dollar fell to its lowest level in three years against major currencies on Wednesday after US Treasury Secretary Steven Mnuchin said the US administration favors a weak dollar in trade.

On Thursday, Mnuchin confirmed his words.

“I thought my comment on the dollar was actually quite clear yesterday. I thought it was balanced and consistent with what I said before, which is we are not concerned with where the dollar is in the short term," he said, as quoted by Bloomberg.

President Donald Trump’s administration has repeatedly said that a weak dollar helps make American-made goods more competitive with goods from China and other markets.

For more stories on economy & finance visit RT's business section