RMB internationalization make bitcoin sustained value-added
In October 1st this year, IMF yuan in the SDR currency basket (SDR). The only country currency are eligible to be included, now Chinese currency has become one of them: the dollar, pound, yen, euro and rmb.
IMF can no longer ignore the world’s second largest economy, the existence of money. Chinese is also active in efforts to promote the process of internationalization of the rmb. This means that China will gradually open the capital account gradually accept the market pricing of rmb.
China is not a copy of foreign countries follow the prescribed order, however, the government of Beijing to recognize the renminbi was added to this symbolic currency basket, will further allow the normalization of its economy, through the way of further integration into the international community.
How the performance of RMB after joining? This year the RMB depreciated by 7%. We agree we need to devalue the yuan. The problem is how the pace of depreciation, depreciation and finally to what extent.
Chinese keen to credit to stimulate economic growth. The government recognizes this problem, however, is still in such a way. Not heavy industry is household necessities production department, must bear these losses. For the Beijing government, the problem of heavy industry is strong in political status, is more important is that there are millions of office workers. The government’s goal is to maintain social stability. Therefore, the state-owned banks still credit to state-owned industrial and Real Estate Company.
Continue to print money to a large number of Chinese depreciation in the case of the rmb. Many companies and individuals in order to escape the coming of inflation and the choice of the transfer of assets abroad. In the IMF of RMB for review, and prior to joining SDR, Chinese already let the devaluation of the many. If Chinese let the devaluation of 30%, to join the international reserve currency application at the same time, will face the loss in the international community. If you are in China life long enough, you will know that no matter how not to lose face.
Foreign exchange reserves data showed large capital outflows, this is a warning signal. However, the company also continues to Chinese global large-scale mergers and acquisitions. Chinese citizens continue to invest heavily in the global luxury residential market. Vancouver Canada recently issued a regulation for foreigners to buy real estate 15% tax, in order to curb the greed of the Chinese purchase.
Now China officially joined the SDR club, can use more monetary tools to regulate the economy, like Fed, ECB, BOJ and BOE do not disgrace to practise. A good name is the euphemism for quantitative easing to print money. Western bankers were good at this. Now Chinese publicly in the game.
Traders will pay close attention to the people’s Bank of Chinese (PBOC) released the reference rate at 9:15. In the first week of RMB after joining the SDR, Chinese central bank will set an example for the future. Now the Federal Reserve in 11 and December to raise interest rates more likely, we believe that the central bank will introduce more Chinese measures. At the end of the year when the exchange rate of USD-CNY is likely to be 7.
Don’t forget to europe. One or more of the banks are likely to collapse in the fourth quarter. Maybe China central banks need to inject more money to reduce the impact on them. In general, the golden week holiday, the bank does not have what action. Next week a lot of news.
This trend is very obvious, the yuan fell, bitcoin rose. If the central bank China devaluation of the yuan in the fourth quarter, bitcoin will rise from the downturn is likely to reach $1000 station.