China To Launch Yuan Swap Trading With Russian Rubles On Monday

Tyler Durden's picture

The world was slow to wake up to the new reality in which China is now the de facto IMF sovereign backstop, as Zero Hedge described two weeks ago in "China Prepares To Bailout Russia" when we noted that a PBOC swap-line was meant to reduce the role of the US dollar if China and Russia need to help each other overcome a liquidity squeeze, something we first noted over two months ago in "China, Russia Sign CNY150 Billion Local-Currency Swap As Plunging Oil Prices Sting Putin."

In fact, it was only this week that Bloomberg reported that "China Offers Russia Help With Currency Swap Suggestion." But in order to fully backstop Russia away from a SWIFT-world in which the dollar reigns supreme, one extra step was necessary: the launching of direct FX trade involving the Russian and Chinese currencies, either spot or forward - a move away from purely theoretical bilateral FX trade agreements - which would not only enable and make direct currency trading more efficient by sidestepping the dollar entirely, but also allow Russian companies to budget in Chinese Yuan terms. It is no surprise then that this is precisely the missing step that was announced overnight, and will be implemented starting Monday.

From Bloomberg:

China will allow trading in forwards and swaps between the yuan and three more currencies in a bid to reduce foreign-exchange risks amid increased volatility in emerging markets.


The China Foreign Exchange Trade System will begin such contracts with Malaysia’s ringgit, Russia’s ruble, and the New Zealand dollar from Dec. 29, it said in a statement on its website today. That will extend the yuan’s swaps trading to 11 currencies on the interbank foreign-exchange market.


A plunge in Russia’s ruble this month to a record low sparked a selloff in developing nations’ assets, leading to a surge in currency volatility. The new contracts come amid efforts by China to increase the international use of the yuan, as the world’s second-largest economy promotes it as an alternative to the U.S. dollar for global trade and finance. Malaysia and Russia are China’s eighth and ninth biggest trading partners, according to data compiled by Bloomberg.


This will provide companies with better hedging tools, and at the same time, make currency trading more efficient,” said Ju Wang, a senior currency strategist at HSBC Holdings Plc in Hong Kong. “China won’t stop yuan globalization or capital-account opening because of the volatility in emerging market currencies.”


The CFETS is an agency under the People’s Bank of China.

So while the US continues to parade with "destroying" the Russian economy, even if it means crushing the shale industry, aka the only bright spot, and high-paying job-creating industry in the US economy over the past 5 years, Russia and China continue to be nudged by the west ever closer monetarily and strategically, until one day, as we have long predicted, China and Russia will announce a joint currency, one backed by both China's "surprising" gold reserves and Russia's commodity hoard. Then things will get interesting.

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winchester's picture
winchester (not verified) Dec 26, 2014 8:27 AM

.......Then things will get interesting.


i just can't wait.

Latina Lover's picture

Fruck you USA.... Blyat Europa

Informal name for the new China Russia Currency arrangement.

economics9698's picture

Fuck the money counterfeiters, fuck the Zionist.

Winston Churchill's picture


Looks like they ironned out any bugs from their little test, because this swap is not going thru'

Belgium.This is an Official announcement without the announcement.

Keyser's picture

Let's watch the US "isolate" China the same way they are trying with Russia.... Bwahaaaaaaaaa... 


Troll Magnet's picture

Tired of Jews in control. Sick of it.

CH1's picture

Tired of your obsessed, twisted mind... or your employer's... not sure which it is.

COSMOS's picture

LOL WC more like tick tick tick tick, the ticking time bomb for the dollar lol

Chupacabra-322's picture

"China and Russia will announce a joint currency, one backed by both China's "surprising" gold reserves and Russia's commodity hoard"

Russia's Hoard meaning Gold, Natural Gas, Oil & Uranium. FYI, 1 out of 10 homes in the Criminal Fraud UNITED STATES, CORP. INC. is powered by Russian energy.

UselessEater's picture

Lets cheer. Its possibly the path to a new true & honest money system, the BRICS are showing a steady  unrelenting war with the BIS in their fight for independence... oh wait, BIS ain't complaining.

Awesome uprise.

COSMOS's picture

Sure you are going to believe the news outlet of former mayor Bloomberg, same ahole that wanted to set limits on the size of your beverages.  Do you think he wouldnt also want to set limits on the amount of information you should be getting lol

assistedliving's picture

as ZH Putin lovers go long the Blyat Europa at its height vs the USD/Euro the Blyat collapses triggering

the ZH long awaited crash which they cannot take advantage due ZHers trapped in the Blyat

TheFourthStooge-ing's picture

Didn't take long for one of the fappars* to seize the opportunity to whine in public.

as ZH Putin lovers go long the Blyat Europa

Poor little feller sounds like his butthole hurts.


*fairies against President Putin and Russia


trulz4lulz's picture

This dosent even make any fucking sense! There isnt a real sentance in that entire dribble of stupidity that managed to eek its way from your mind/code.

Could it be? Have merkins finally reached peak stupidity? The saga continues. I look forward to skipping all of your posts. Good day!

remain calm's picture

Bye Bye US dollar hegemony.

Rootin' for Putin's picture

Thats a great idea for a song title.

A long long time ago
I can still remember how
The greenback used to make me smile
And no matter how hard it seemed
i knew i could reach the americam dream
And i would be happy for a while

But the tv made me shiver
With every headline they'd deliver
Bad news on the doorstep
I couldn't take one more step

I can't remember if I cried
When I read about his wookie bride
Reggie touched me deep inside
The day the dollar died

Bye, bye dollar hedgenomy
Drove my prius to the pawn shop but they wouldnt buy
And them good ole boys were sending stocks high
Singin' this'll be the day that I buy
This'll be the day that I buy

Did you stop the south stream line?
And believe that every thing is still fine
If the whitehouse tells you so?
Do you believe in shock and awe?
Marie Harf, and that other whore?
And can you teach me how to dance real slow?

Well, i know its your coup in Ukraine
'Cause I saw you send in McCain
Nuland kicked off her shoes
and said hey just fuck the EU

I was a isolated Russian president
My economy you tried to dent
But I knew you were out of luck
The day the dollar died
I started singin'

Bye, bye dollar hedgenomy
Drove my prius to the pawn shop but they wouldnt buy
And them good ole boys were sending stocks high
Singin' this'll be the day that I buy
This'll be the day that I buy

Now, for eight years we've been on our own
And wall street grows fat on a QE
But, that's not how it used to be

When stock markets were allowed to crash
and people still had faith in cash
And a voice that came from you and me

Oh and while the king was playin golf
Chinese Yuan stole his paper crown
The move they made was bold
they backed it up with gold

And while yellen read a book on keynes
The people were on their knees
And we were trying not to freeze
The day the dollar died
We were singin'

Bye, bye dollar hedgenomy
Drove my prius to the pawn shop but they wouldnt buy
And them good ole boys were sending stocks high
Singin' this'll be the day that I buy
This'll be the day that I buy

Freddie's picture

+100 even though I feel like for us it gallows humor.  Still the satust z-quo of the money changers is worse. 

ZH Snob's picture

the question of how tied Russia and China are to the rothschild central banking scheme is certainly a big one.  it has been noted that both countries still have these parasites running their banking.  this CFETS is great news.  it would seem that China is in no rush or need to make hasty moves.  this exchange should stabilize things for now.  and Russia is equally prudent in its foreign policy with the NATO invaders.  it is the USSA clumsily pushing europe and japan into crazier ventures that are clearly not in either's national interest.

the real time to celebrate will be if and when China and Russia do an Icelandic move and send the central bankers packing.  this will tell us if they are for real.

RaceToTheBottom's picture

The goal has never been to do away with central bankstering spoils, the goal is to take the central bankstering spoils from the US FED and to give them to themselves...

Peons are still peons.

Not saying it is not a good deal to screw the Banksters, but for the peon, life will not change much..


UselessEater's picture

A ZH'r posted this link... long read, here are a few take aways. These are intended to simply point out the obvious. FFS there is no indpendant central bank or alternative money system being created.

Cheering for BRICS vs USA is the PLAN.

Call me when the BIS has F'all to do with any nation chucking a tanty (not going to happen).

bits and bobs:

- RCB retains right to issue the rouble... same as the Fed Reserve Note
-it controls the Russian reserves and gold, these are given by the Russian people but do not belong to Russia or it people; it can do as it wishes with these reserves and gold accumulations... any complaints, it has the right to take the government to a number of international courts based in Stockholm, New York, etc.

‘Article 6. The Bank of Russia is authorised to file suits to courts in accordance with the legislation of the Russian Federation. The Bank of Russia is entitled to appeal to international courts, courts of foreign countries and courts of arbitration for protection of its rights’.

- the majority of its gold and forex is NOT stored in Russia; and about 30% of its reserves are invested in US Treasuries, some in the IMF, etc the RCB is prohibited by law from buying Russian bonds, it can only buy foreign bonds:

‘Article 22. The Bank of Russia is not entitled to credit the Government of the Russian Federation to fund budget shortfall, buy state securities at the initial offer, except for the cases when it is provided for by the federal law on federal budget’. The Central banks of the so-called developed countries credit the budget through buying state bonds. And our Central Bank is not allowed to buy Russian bonds. But it can buy American state bonds and securities of some

other countries.

- However, the RCB stores the whole Russian budget.

omniversling's picture

Best researched analysis/summary of historical Yale (skull&bones)/NWO/Mao (and earlier) courting/opening up of China I've read (links below). Includes key concepts like 'Nation State is dead, replaced with Corporate State' (most ex Nation States are already 'registered corporations'. See Mussolini's contextual 'merger of corporations and 'state = fascism).

Have previously referred in my musings to the 'Sinoisation' (cute, sounds like 'Zionisation') of the planet, where 1/ the self-chosen embedded 'politburo' owns the lot, and or dispenses favours to those whom do their bidding and/or 'wetwork' (drivers: FSB/G20 axis, Central Banking, WTO, Favoured Trading Status, PetroYuan/currency swaps etc). 2/ Everyone except the 'owners' and their scribes/gatekeepers on 50c/hr. 3/Competitor 'good cop/bad cop' routine also employed by Russians vs NATO whilst Free Trade Agreements covertly strip sovereignty = Thesis/Antithesis/Synthesis principle. 4/Unaccountable organisations like FSB/BIS/IMF decide which direction Globalisation takes. 5/Great Firewall of China including KillSwitch goes Global (including social media self-disciplinary self-censoring pledging).


Corbett's title Chimerica says lots.



SoilMyselfRotten's picture

Better hurry up with those war plans

Keyser's picture

WIth an ever-shrinking military, I'm sure it's Barry's plan to just drone everyone to death, much like his monologue... 

Freddie's picture

Any American dumb enough to fight and die for Obola, McCain and the banksters is a dummy. 

MiTasol's picture

If only there were a shortage of dumb Americans.

Real Estate Geek's picture

. . . or they have no options other than the military, and deserve some sympathy. 

Arius's picture

Show time


Good timing ... everyone is enjoying his bonuses ... Monday will be interesting


It seems that evil Blythe Masters must be off to London

Keyser's picture

You'll need to talk to Moochie as she's the one with the balls in the family...  Or haven't you seen Barry throw a baseball or ride a bike?

Government needs you to pay taxes's picture

That bikeride in the mom jeans and helmet was a few sparkley tassles short of full girlie.

USisCorrupt's picture

Finally some REAL News with Real consequences.


And soon a Real Currency that has value.


What a novel Idea :-)

Fractal Parasite's picture

Been waiting for this news for weeks.

Perhaps the Russian state kept the window open a bit longer to sell off more of its over-valued FRNs for cheap RUBs, knowing a bounce-back would come, just like they bought up more Gazprom shares after the sanctions made them cheaper.

Freddie's picture

Russian Orthodox Christmas is Jan 7th so the Z-USSA got their present a day late.  I respect the Orthodox church more.  They are not the Catholic black hand nobles or the Evangelicals who are Jonathan Pollard conservatives and Isra-hell firsters.

UselessEater's picture

What real currency?

What real value?

IMF and World Bank have been endorsing the BRICS devlopment bank etc for a few years now. All these CB's report to the BIS and comply with the international courts.

So what is the REAL news with REAL consequences - other than we get more fiat without the name USD and a lot of turmoil?

I am not USA centric - never been to the USA - but this is becoming so obvious a USA centric person should be grasping the BS.

A central bank may have a regional office.... who gives a toot about it? Games will be played between the branches, peeps will think its football and cheer...FFS its could be almost entertaining watching the crowd cheer as the goal posts are moved and then returned to the EXACT same place without them realizing the serious harm it has caused them.

zorba THE GREEK's picture

Another nail in the dollar coffin. 

DaveyJones's picture

and this corpse is performing his own carpentry

cossack55's picture

Love it.  Paging Larry "kingdollar" Kudlow. Stat!

beavertails's picture

You realize what this means!  WAR I tell you.

Vincent Vega's picture

The day the dollah died.

Anunnaki's picture

Peter Tosh predicted this

DaveyJones's picture

bye bye miss american pie

dragged the dollar by the collar

now that doggie is dry

and bad old boys drinking whiskey and lies

singing this will be the day that it dies

this will be the day that it dies

reader2010's picture

John Pilger Says The West Is Lying Itself To Nuclear War

Two Theives and a Liar's picture

I'm sure the derivative complex will just LOVE this!

new game's picture

worship the dolla, but beware of history. will 2015 prove to be the year of demise? moar crumble?

always back to the inflation/deflation discussion. staying clear of all markets where paper is involved.

my continuing resolution- me no paper, just physical. this shit show goes on. trust no one including tyler durden...