NEW YORK -- China's launch of its crude futures exchange today will improve the clout of the yuan in financial markets and could threaten the international primacy of the dollar, argues a new report by Hayden Briscoe, APAC head of fixed income at UBS Asset Management.
"This is the single biggest change in capital markets, maybe of all time," Briscoe said in a follow-up telephone interview.
The launch of the oil futures denominated in China's renminbi currency, also known as the yuan, is China's first commodity derivative open to foreign investors. This marked the culmination of a decade-long push by the Shanghai Futures Exchange to give the world's largest energy consumer more power in pricing crude sold to Asia.
This helps cement the exchange's viability and challenges the petro-dollar system, in which oil deals are executed in dollars. This would decrease demand for the greenback and boost U.S. inflation. ...
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