Interbank Market News Scan: Libor coming to an end. China’s RMB hopes to take out the dollar …

9 July 2021

Foreign exchange rates of interest …

Currency pairExchange rate
USD/XCDXCD 2.70
USD/MXNMXN 20.0188
USD/JMDJMD 148.6230
USD/DOPDOP 56.6164
USD/HTGHTG 92.0194
USD/NGNNGN 411.2120
USD/GHSGHS 5.9153
Source: OANDA

News links of interest …

Interbank. With the end near for the London Interbank Offered Rate (Libor), the Reserve Bank of India (RBI) on Thursday told banks and other financial institutions to stop using the benchmark as soon as possible and mandatorily by December 31 and move to any Alternative Reference Rates (ARR). https://www.business-standard.com/article/finance/rbi-to-banks-phase-out-libor-soon-move-to-alternative-reference-rates-121070900016_1.html

Interbank. The booming collateralized loan obligation market faces a chaotic end to 2021, when the benchmark London interbank offered rate is retired for new loan contracts. https://www.bloomberg.com/news/articles/2021-07-08/growing-clo-market-has-a-libor-transition-problem-on-horizon?sref=oriheOus Interbank. Sri Lanka’s central bank said it will dip into its foreign exchange reserves to partly repay $1 billion of bonds maturing later this month, seeking to allay investors’ concern about a possible default. https://www.bloomberg.com/news/articles/2021-07-08/sri-lanka-keeps-rate-on-hold-as-focus-shifts-to-debt-repayment?sref=oriheOus

Foreign exchange, China. The following are the central parity rates of the Chinese currency renminbi, or the yuan, against 24 major currencies announced on Friday by the China Foreign Exchange Trade System: Market exchange rates in China — July 9 – Xinhua | English.news.cn (xinhuanet.com)

Foreign exchange. Could the RMB dislodge the dollar as the world’s reserve currency. Could the RMB Dislodge the Dollar As a Reserve Currency? – BRINK – Conversations and Insights on Global Business (brinknews.com)

Cryptocurrency.  Why China wants to undermine Bitcoin. Currency and control: why China wants to undermine bitcoin (msn.com)

Cryptocurrency.  The future is far from stateless. Cryptocurrencies’ dream of escaping the global financial system is crumbling | Quinn Slobodian | The Guardian

Interbank Market News Scan: Eastern Caribbean, foreign exchange …

24 June 2021

Eastern Caribbean Central Bank-interest rates

ECCB Fixed Deposit Rate-1 month0%
ECCB Fixed Deposit Rate-2 months0%
ECCB Fixed Deposit Rate-3 months0%
ECCU (1) Minimum Savings Deposit Rate2%
ECCB Discount Rate2%
Source: Eastern Caribbean Central Bank
  • (1) Eastern Caribbean Currency Union

Foreign exchange rates of interest

Where base currency is XCDRates as of 1:15 am AST 24 June 2021Where term currency is XCDRates as of 1:30 am AST 24 June 2021
XCD/EUR0.3103EUR/XCD3.2222
XCD/GBP0.2653GBP/XCD3.7689
XCD/USD0.3704USD/XCD2.7000
XCD/CAD0.4556CAD/XCD2.1946
XCD/NGN151.8860NGN/XCD0.0066
XCD/CNY2.3986CNY/XCD0.4168
XCD/PLN1.4026PLN/XCD0.7122
XCD/PEN1.4509PEN/XCD0.6771
Source: OANDA

Foreign exchange. On 26 May 2021, the Cabinet of Ministers of Ukraine adopted the Resolution adopted a Resolution setting out the procedure the tax authority should use to fine legal entities for violating currency legislation. https://www.lexology.com/library/detail.aspx?g=b6a6e9df-ddaa-49c7-821a-355d5b0cf097

Foreign exchange. The U.S. dollar vacillated below an 11-week high versus major peers on Thursday as traders attempted to navigate conflicting signals from Federal Reserve officials on the timing of a withdrawal of monetary stimulus. https://www.cnbc.com/2021/06/24/forex-markets-dollar-us-federal-reserve.html

Interbank. Flour millers in Nigeria are turning to the street market for dollars to buy wheat after the central bank restricted the use of the U.S. currency to buy grain imports, according to the country’s third-largest operator. https://www.bloomberg.com/news/articles/2021-06-23/nigeria-flour-millers-squeezed-by-central-bank-ban-on-imports?sref=oriheOus

Interbank. The overnight Shanghai Interbank Offered Rate (Shibor), which measures the borrowing cost of China‘s interbank market, decreased 9.3 basis points to 2.208 percent Wednesday. http://www.china.org.cn/china/Off_the_Wire/2021-06/23/content_77581796.htm Interbank. China’s central bank boosted its short-term cash injection for the first time since March as it sought to cater to a growing demand for liquidity while keeping leverage in check. https://www.bloomberg.com/news/articles/2021-06-24/china-lifts-short-term-cash-injection-for-first-time-since-march?sref=oriheOus

Interbank Market News Scan: How will G7, NATO impact China-Caribbean trade relationship; foreign exchange …

15 June 2021

News from the Eastern Caribbean Securities Exchange

On 28 June 2021, the Government of St. Lucia will auction a 180-day Treasury bill estimated to raise ECS$10 million.  The Bank of St. Lucia and First Citizens Investment Services are the broker firms.

Food for Thought: On China and the Caribbean

The NATO and G7 meetings held one thing in common other than the membership of a number of rich industrialized countries: China.  While the NATO meeting fell short of calling China an “adversary”, the consensus, especially among the leading industrialized nations, is that China, at a minimum, is a competitive economic threat.

One example of its economic threat is Huawei, a Chinese telecom equipment provider accused of ties to the Chinese military.  Huawei provided less expensive telecom equipment to Europe in direct competition with American telecom equipment providers.  The United States, which banned use of Huawei equipment from its telecom networks, chided its European allies for allowing a threat to privacy via Huawei equipment.  Turning a back on Huawei expectedly gives US companies a wider door to enter through into European markets.

It may be too early to determine the impact on the Caribbean a widening rift between China and the US may present.  By our estimate, using CIA data, at least 12 Caribbean countries have a trading relationship (import only, export only, or both) with China.  Whether the Caribbean will tack away from a relationship with China as a result of moves made by the G7 or NATO remains to be seen.

 Import-Export relationship between CARICOM nations and China

Source: CIA World Factbook

CountryImport from ChinaExport to China
St. LuciaNoNo
Trinidad and TobagoYes (USD366 million)Yes (USD595 million)
SurinameYes (USD168 million)No
St. Vincent and the GrenadinesYes (USD23.7 million)No
MontserratNoNo
GuyanaYes (USD8 million)No
GrenadaYes (USD16 million)No
DominicaYes (USD12 million)No
BelizeYes (USD11 million)No
BarbadosYes (USD136 million)No
Antigua and BarbudaYes (USD39 million)No
The BahamasNoYes (USD33 million)
Cayman IslandsNoNo
HaitiYes (USD795 million)No
St. Kitts and NevisNoNo
JamaicaYes (USD804 million)No
British Virgin IslandsNoNo
Turks and CaicosNoNo
BermudaNoNo
AnguillaNoNo

Foreign exchange rates of interest

Source: OANDA

Currency PairsRates as of 11:15 am AST 15 June 2021
XCD/EUR0.3057
XCD/GBP0.2625
XCD/USD0.3704
XCD/CAD0.4500
XCD/NGN152.3900
XCD/CNY2.3692
XCD/PLN1.3776
XCD/PEN1.43619

Links to follow ….

Caribbean Development. A high-level panel of government and business leaders will explore the impacts of the COVID-19 pandemic on the Caribbean in the opening seminar of the Caribbean Development Bank’s (CDB) 51st Annual Meeting. https://www.caribank.org/newsroom/news-and-events/cdb-annual-meeting-seminar-discuss-policies-economic-recovery-covid-19-and-more-resilient-caribbean

Interbank. China’s interbank treasury bond index in net price opened at 982.99 points Tuesday, lower than the previous close of 983.65 points, according to the China Foreign Exchange Trade System. http://www.china.org.cn/china/Off_the_Wire/2021-06/15/content_77568539.htm

Interbank. The Korea Interbank Offered Rates (KORIBOR) as posted by Yonhap Infomax, the financial news and information arm of Yonhap News Agency, at 11:00 a.m. https://en.yna.co.kr/view/AEN20210615004100320

Banks. Billionaire investor Mark Cuban is very bullish on the future of DeFi, or decentralized finance, and DAOs, or decentralized autonomous organizations. https://www.cnbc.com/2021/06/14/mark-cuban-banks-should-be-scared-of-defi.html

Interbank Market News Scan at 2:45 pm GMT

Links you should follow …

Interbank, interdealer. Interbank trading activity accounted for more than 80% of the US$3.1trn in interest-rate derivatives that left the UK for the US and the European Union in the wake of Brexit, according to IFR calculations using IHS Markit data. Interbank trading drives post-Brexit swap migration | IFR (ifre.com)

Interbank, interdealer. Paul Houston, Global Head of FX Products, CME Group, recently caught up with Traders Magazine to discuss the drivers causing change in the FX derivatives market, what CME Group has been doing to alleviate the pain points from these changes, and the exchange’s future plans.  FX Futures and Options Innovation in Focus – Traders Magazine

Interbank, interdealer. US exchange group ICE has invested in FinTech and municipal bond network BondLink to develop infrastructure servicing in the $4 trillion market. ICE invests in US municipal bond network BondLink (thetradenews.com)

Interbank, China. The following are the central parity rates of the Chinese currency renminbi, or the yuan, against 24 major currencies announced on Monday by the China Foreign Exchange Trade System. Market exchange rates in China — May 24 – China.org.cn Interbank, Pakistan. The Pakistani rupee depreciated 34 paisas against the United States (US) dollar in the interbank currency market on Monday. Rupee weakens against US dollar (arynews.tv)

Foreign exchange rates of interest …

Currency PairsRates as of 2:45 pm GMT 24 May 2021Rates as of 1:43 pm GMT 21 May 2021
GHS/EUR0.14150.1417
GMD/EUR0.01590.0159
NGN/EUR0.00200.0020
SLL/EUR0.00010.0001
KES/EUR0.00770.0075
RWF/EUR0.00080.0008
ZAR/EUR0.05870.0584
MZN/EUR0.01360.0136
XCD/EUR0.30400.3035
Source: OANDA

Interbank Market News Scan: China is graying and will need to revamp its demographic policies ….

Links to follow today ….

Central banks, China. A pension deficit and looming debt crisis driven by a rapidly greying population. That’s the nightmare scenario for Chinese authorities, including the nation’s central bank, who are increasingly worried about the financial implications of the country’s demographic challenges. China population: what’s driving central bank concern about the nation’s ageing workforce? | South China Morning Post (scmp.com)

Central banks, CBDCs. The proposed authoritarian evolution of centrally issued digital currencies takes the world closer to dystopia. Central Bank Digital Currencies And The Orwellian New World Order | Nasdaq

Central banks, bitcoin. Billionaire investor Mike Novogratz said Thursday the surge in cryptocurrencies is serving as a referendum on the perceived ability of the Federal Reserve to manage risks facing the world’s largest economy and suggested people continue to buy into bitcoin. Billionaire investor Mike Novogratz says the record-breaking rally in crypto shows a lack of faith in the Fed – and cites central-bank uncertainty as a reason for bitcoin’s latest surge (msn.com)

Central banks, Bank of Canada. The Bank of Canada sent out a warning to investors this week that inflation still matters. In a surprise move, it accelerated the timetable for a possible interest-rate increase and began paring back its bond purchases on Wednesday. That made Canada the first major economy to signal its intent to reduce emergency levels of monetary stimulus. Inflation Forces the Bank of Canada’s Hand Ahead of Fed and ECB (msn.com)

As we enter a new week, the rates to start your day ….

As of 11:30 am EST, Bloomberg reports that the yield on the three-month Treasury note closed at 0.02% last Friday while the two-year note closed at 0.16%. The ten-year and thirty-year Treasurys closed Friday at 1.56% and 2.23%, respectively.

The Federal Funds rate, the rate at which banks lend to each other overnight in support of their reserve requirements, is at .07%, while the Fed Funds target rate is still at .25%. The prime lending rate is 3.25%.

Exchange rates of interest as of 5:30 pm EST….

Currency PairsRates as of 5:30 pm EST 25 April 2021
EUR/USD1.1890
GBP/USD1.3718
USD/CAD1.2568
AUD/USD0.7625
USD/JPY108.0210
USD/NOK8.5402
USD/CHF0.9417
USD/SEK8.7274
USD/MEX20.5078
Source: OANDA

Interbank market news scan: Should the US be concerned about falling behind the “digital currency curve?” Bitcoin, Ethereum prices fall …

News you should be following. Follow the links …

China’s rapid development of its sovereign digital currency, the so-called digital yuan, is causing the United States to worry that it could fall behind in the race for financial technology innovation, analysts said. China digital currency: US ‘worried’ as it falls ‘behind the curve’ in race for financial innovation (koreatimes.co.kr)

Trading was muted overnight while markets await the latest views from central banks. The US Federal Reserve, the Bank of Japan and the Bank of England headline a cattle call of central banks due to deliver interest rate decisions this week. Markets stall ahead of Fed | CMC Markets

The US dollar is gaining ground on the other major currencies as the foreign exchange market reacts to rising Treasury yields. The prospect of inflation continues to dominate investors’ minds, as all the conditions appear to be in place for a massive rebound in economic activity that is likely to cause consumer prices to spike. Daily market commentary: The foreign exchange market reacts to rising Treasury yields (leaprate.com)

Despite banking services becoming increasingly digital and accessible through mobile devices, there are still 1.7 billion adults without an account at a financial institution. Although The World Bank’s 2017 report confirms some improvement in this regard, only 300 million individuals succeeded in overcoming this hurdle between 2014 and 2017. At this rate, the imbalance of financial access will remain a pressing problem for some time to come. DeFi Is the New Lemonade Stand (yahoo.com)

In 2021 the modern economic landscape is already beginning to shift. The growth of cryptocurrencies and decentralized finance (DeFi) has been a part of the discussion for years, but the reality of how it will impact securities trading is finally being realized. An increasing number of securities are now digitized, underpinned by distributed ledger technology (DLT) that provides the necessary tools that allow for faster, cheaper and ultimately more secure markets, regardless of asset type. The Rise of Digital Securities | Nasdaq

Cryptocurrency exchange rates as of 11:45 pm EST 16 March 2021 …

BTC/USD=55,332.10 ETH/USD=1,767.68

BTC/EUR=46,430.60 ETH/EUR=1,482.99

BTC/GBP=39,875.10 ETH/GBP=1,273.88

BTC/AUD=71,447.80 ETH/AUD=2,282.53

BTC/CAD=68,972.00 ETH/CAD=2,203.43

BTC/CHF=51,241.80 ETH/CHF=1,637.01

BTC/JPY=6,035,080.00 ETH/JPY=192,801.00

BTC/CNY=359,694.00 ETH/CNY=11,491.10

Source: OANDA

Interbank news scan: Latest global central bank and foreign exchange news …

The overnight Shanghai Interbank Offered Rate (Shibor), which measures the borrowing cost of China’s interbank market, increased 6.3 basis points to 1.738 percent Friday. Source: Xinhuanet

Some of the world’s biggest banks are urging a US judge not to immediately terminate the London Interbank Offered Rate (Libor) after a group of borrowers filed suit claiming the benchmark was the work of a “price-fixing cartel.” Source: BusinessWorld

How do you wean everyone from asset managers and traders to corporate treasurers off derivatives that are so ubiquitous, they’ve become part of the fabric of the financial system? Source: Bloomberg

Data from the Central Bank of Kenya (CBK) covering the lead up to Friday showed that daily interbank rate was on a rising trend, sending the average near the 6.29 per cent that was last seen in April 2020. Source: Business Daily

On January 15th, the midpoint of RMB exchange rate in the interbank foreign exchange market is: 1 US dollar to RMB 6.4633, 1 euro to RMB 7.8549, and 100 yen to RMB 6.2263. Source: SMM News

US waits for Senate election results from Georgia; strength of US dollar against European, African currencies a mixed bag …

PairsOANDA as of 4 January 2021OANDA as of 6 January 2021Notes
USD/KES108.391108.461Dollar flat
USD/NGN384.938381.690Dollar weakening
USD/GHS5.85245.85693Dollar flat
USD/CDF1950.611950.01Dollar flat
USD/AOA648.310649.149Dollar flat
USD/ZAR14.630914.8552Dollar strengthening
Source: OANDA

Meanwhile, as the count in Georgia comes to a close, yields on longer term notes begin to increase as the Senate gets closer to a 50-50 split and the likelihood of more spending under a Biden administration ….

RatesFederal Reserve as of 4 January 2021Bloomberg as of 6 January 2021 10:30 am AST
Federal Funds Rate0.090.08
Prime Rate3.253.25
3-month Treasury0.090.08
2-year Treasury0.110.13
10-year Treasury0.931.02
30-year Treasury1.661.78
Source: Federal Reserve, OANDA

And the buzz phrase again mid-week is dollar weakening as exchange rates for a number of foreign exchange pairs continues to fall. This in light of disappointing jobs numbers from ADP where the payroll company determined that 123,000 jobs were lost in December 2020.

PairsFederal Reserve as of 4 January 2021OANDA as of 4 January 2021OANDA as of 6 January 2021 10:45 am AST
GBP/USD1.36621.36331.35967
USD/CAD1.27531.27261.27269
USD/CNH6.52506.45526.43929
USD/DKK6.08396.06576.05823
EUR/USD1.22301.22641.22774
USD/INR73.010072.936773.0696
USD/MXN19.892019.838219.9091
USD/JPY103.1900103.02102.36
USD/NOK8.57578.53008.50760
USD/SEK8.20958.20918.20299
USD/CHF0.88410.88150.87959
Source: OANDA

Foreign exchange rates. Dollar continues its fall …

Foreign exchange rates of interest as of 9 December 2020, 5:30 pm AST:

How to read the chart:

CAD/USD: If you come to the United States with one Canadian dollar (CAD)and wish to sell it for a US dollar (USD), the market price is .78113 USD.

USD/CAD: If you take a US dollar (USD) to Canada and wish to sell it for a Canadian dollar (CAD), the market price is 1.28002 CAD

INR/USD = 0.01356 USD/INR=73.6386

CAD/USD= 0.78113 USD/CAD= 1.28002

JMD/USD= 0.00682 USD/JMD = 143.631

EUR/USD= 1.21122 USD/EUR = 0.82552

NGN/USD= 0.00260 USD/NGN = 379.723

CNH/USD= 0.15338 USD/CNH = 6.51859

JPY/USD = 0.00961 USD/JPY = 104.09

Source: OANDA

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The foreign exchange environment for Trinidad and Tobago …

As of 12:37 pm AST, here are foreign exchange rates for countries trading commodities with Trinidad and Tobago.

How to read the chart:

USD/TTD: If you come to Trinidad and Tobago with one United States dollar (USD) and wish to sell it for a Trinidad and Tobago dollar (TTD), the market price is 6.65560 TTD.

USD/CAD: If you take a Trinidad and Tobago dollar (TTD) to the United States and wish to sell it for a United States dollar(USD), the market price is 0.14482 USD.

Trinidad and Tobago exports 34.8% of its commodities to the United States and 9% to Argentina. Almost 24% of its imports are from the U.S. followed by Russia (15.3%), Columbia (11.1%), and Gabon (10.5%).

USD/TTD=6.65560 TTD/USD=0.14482

ARS/TTD=0.08165 TTD/ARS=11.8034

RUS/TTD=0.0889 TTD/RUS=10.8354

COL/TTD=0.00190 TTD/COL=505.772

XAF/TTD=0.01231 TTD/XAF=78.2939

CNH/TTD=1.01748 TTD/CNH=0.94712