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Internationalization of RMB goes up again

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Core Tip:Renminbi crude oil futures were successfully listed. The first week's total turnover was nearly 116 billion yuan, with a
Renminbi crude oil futures were successfully listed. The first week's total turnover was nearly 116 billion yuan, with a turnover of more than 270,000 contracts, an average of 54,000 contracts per day, and 54 million barrels of crude oil. This daily average of more than 8 million barrels of Dubai Commodity Exchange (DME), ranking third in the world, second only to London Brent crude oil futures and the United States West Texas light (WTI) crude oil futures. It is worth pointing out that the highlight of RMB crude oil futures is actually the RMB. This is another milestone in the internationalization of RMB following the addition of special drawing rights (SDR), which will increase the international influence of RMB.
 
 
 Internatio<em></em>nalization of RMB goes up again

 
The international status of a currency can be judged based on whether it becomes an important anchor currency in the region. Oil is the dominant energy source in the world. The global crude oil trade pricing is mainly based on the price found in the futures market. At present, WTI and Brent crude oil futures are benchmark crude oil contracts in the Americas and Europe, respectively, which dominate the pricing power of international crude oil. This is the fundamental point of the US dollar as the crude oil trade settlement currency. In contrast, Asia has not long had a pricing benchmark that has an impact and can fully reflect the actual supply and demand of crude oil in the region. Renminbi crude oil futures will undoubtedly fill this gap and will increase the anchor currency status of the renminbi in Asian currency regions and oil producing countries participating in the “One Belt and One Road” construction, thereby supplementing and improving the existing international crude oil pricing system and international monetary system. From the first week of trading, the correlation between RMB crude oil futures and other crude oil futures is good, especially Dubai DME crude oil futures, because crude oil futures delivery of RMB crude oil is mainly Oman crude oil in Dubai, and Oman’s crude oil exports are 60%. to China.
 
The international influence of a currency is first reflected in its international use. At present, the international use of the renminbi is still relatively low. Although China has become the world’s largest crude oil importer, the crude oil trade is still passively billed and settled in US dollars. Crude oil futures denominated and settled in renminbi will change the status quo of “My Crude Oil and His Pricing”, provide a benchmark for pricing and risk mitigation for China’s crude oil trade, and promote the formation of oil renminbi, thus increasing the renminbi’s international economic activity. The actual level of use. If the crude oil imported by China is settled in RMB in the future, the total trade volume will exceed RMB 1 trillion, which will greatly increase the demand for RMB in the oil-producing countries participating in the “One Belt and One Road” construction. Moreover, on the basis of petroleum renminbi, the renminbi's function of pricing and settlement of agricultural products, minerals and other bulk commodities will also accelerate development, thereby further increasing the international use of the renminbi.
 
The international influence of a currency is also reflected in the impact of exchange rate changes on other currencies. At the beginning of the listing of China’s crude oil futures, the price after exchange rate conversion was better than the price of crude oil futures in the international market, causing foreign investors to convert US dollars into offshore renminbi for arbitrage, pulling up offshore renminbi exchange rates, and driving onshore RMB exchange rates. rise. As crude oil futures advance the internationalization of the renminbi, the impact of changes in the renminbi exchange rate on other currencies will continue to increase.
 
Following the successful listing of China's crude oil futures, the internationalization of China's iron ore futures has also been put on the agenda. The downstream industrial chain of raw materials for these two major industrial products covers a wide range, and its RMB futures will allow the renminbi pricing and settlement to extend to the entire commodity trading system. The international influence of the renminbi will be further enhanced in the future.
 
 
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