Goldilocks’ Global Economic News 6-6-24
Digital Currency Project Announcement:
Saudi Arabia joins China and UAE in digital currency project. The kingdom is joining the Switzerland-based Bank for International Settlements’ central bank digital currency platform.”
Saudi Arabia is the latest country to join this multi-country initiative utilizing wCBDC as a form of payment.
This announcement came on Wednesday as Saudi Arabia joined Project mBridge as a “full participant.” This means that Saudi Arabia will be moving to a wCBDC payment regimen joining many countries in the Eastern half of our world in payments through local currencies.
This will significantly minimize the use of the Petro Dollar if not completely over time. Currently, Saudi Arabia still services the United States along with China who uses the Petro Yuan to trade in oil agreements.
This will level the playing field a great deal in the use of currencies moving from a Petro Dollar regimen to wCBDC payment source. Remember, well over 80% of trade around the world is done on the water where exchange rate quotas and percentages are currently under pressure from new demands on local currencies to begin looking at resetting their prices. Al-Monitor State Gov
WATCH THE WATER.
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The word is on the street and in the back rooms of the trading markets that the US may not lower interest rates until just before the election. We will see if we can wait that long.
The surrounding countries we trade with will put significant pressure on the dollar if we do not make this monetary policy change ourselves. It is important to note that these recent changes may not be permanent anyway, but it will give some breathing room for countries who need an opportunity to gather in more loans as we approach a Gold Standard Regimen.
Holding interest rates at higher levels will strengthen currencies as we approach a Gold Standard support system. Many countries are already making this shift into gold gradually, but the pace may soon pick up.
When you combine strong technical fundamentals with a real value through gold, it creates new movement in the opposite direction we are going at the present time.
Unless things change for the European Union, they are still planning on going to a Gold Standard Protocol January 1st, 2025. Countries will begin following suit in the process between now and then in preparing their countries for this change.
Gold will set us free!
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Silver Technical Scoop: Precious Benefit, Market Divergences | SilverSeek
Gold and silver have been taking a divergent path as of late, and it may do so until the end of July. This is normal, but the timing of this is impeccable.
A great deal of attention will be placed on transitioning this economy into digital assets. Gold and silver will have competitive asset classes to draw from these next two months, but they will merge together as the year goes on complimenting one another.
The merging of the traditional economy into a gold standard protocol through digital assets is the next move. Look for credit valuation judgments along the way to form new patterns of behavior on Market structures as they correlate their prices into a real value.
© Goldilocks
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ISO 20022 in bytes for payments: Supporting your CBPR+ readiness | Swift
Swift Announcement:
“The community continues to make steady progress with Global ISO 20022 adoption and with only 18 months to go until the end of coexistence, the daily average number of CBPR+ messages exchanged now exceeds one million.
At its March 2024 meeting, the Swift Board re-confirmed the community’s commitment to November 2025 as the end of the MT/ISO 20022 cross-border coexistence period, emphasizing that priority should be given to instruction messages to ensure operational continuity and ongoing interoperability.”
This gives us ISO 20022 coverage through the Swift System until November 2025 when the Swift System gives way to the new digital messaging system.
Countries seeking to join the ISO 20022 messaging system have until November of 2025 to do so. Until then, Swift is extending itself as a bridge for countries needing to make this transition.
This does not mean that the transition of the new banking system has to wait until November 2025. It just means that the banking messaging system will be able to go ahead and transition as we wait for this date.
© Goldilocks
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Israel advances digital shekel initiative with new innovation challenge | Crypto Reporter
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Interest rates are likely headed down, at least in Europe | AP News
European Central Bank Announcement:
FRANKFURT, Germany (AP) — The European Central Bank cut its key interest rate Thursday by a quarter point, moving ahead of the U.S. Federal Reserve as central banks around the world lean toward lowering borrowing costs – a shift with far-reaching consequences for home buyers, savers and investors.
The ECB cut its benchmark rate to 3.75% from a record high of 4% at a meeting of the bank’s 26-member rate-setting council in Frankfurt.
The ECB said in a statement that “price pressures have weakened, and inflation expectations have declined at all horizons,” allowing it to start loosening credit.
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Bank of Canada cuts key interest rate to 4.75% | CBC News
The Bank of Canada announcement:
The Bank of Canada has lowered its key interest rate to 4.75 percent, marking the bank’s first rate cut since March 2020.
Bank governor Tiff Macklem said in opening remarks that the bank’s monetary policy no longer needs to be as restrictive.
“We’ve come a long way in the fight against inflation. And our confidence that inflation will continue to move closer to the two percent target has increased over recent months,” Macklem said.
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SBV vows to fight Vietnam’s goldization | SGGP English Edition
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Temenos and Mastercard join forces to expand cross-border payment capabilities through Mastercard Move | Morningstar
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The Unitas Protocol for emerging market currency stablecoin | Ledger Insights
Emerging Market Stablecoin Announcement:
Tether recently announced its funding of XREX, which targets emerging market trade payments. This spotlighted the Unitas Protocol for emerging market currency stablecoins, co-founded by Wayne Huang, XREX’s CEO.
Today stablecoins are dominated by dollars. It can be useful for SMEs to pay with local currencies as well. Hence, the aim is to provide stablecoins that match the unit of account in emerging economies.
The Unitas Protocol involves the issuance of individual currency stablecoins that are over-collateralized by US dollar stablecoins, a little reminiscent of MakerDAO’s DAI, but with some major differences.
While most fiat currency stablecoins are redeemable for the same currency, the Unitas Protocol aims to back emerging market currencies with US dollar stablecoins.
Provided Unitas gains traction, cryptocurrency exchanges will act as on- and off-ramps. Hence, even though a Unitas currency is redeemable for dollars, users may choose to exchange Unitas currencies directly for local currencies without necessarily needing to go the US dollar route.
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Project mBridge reaches minimum viable product stage and invites further international participation | BIS
Private sector participants are invited to propose value-added solutions that can be connected to the mBridge MVP platform.
More central banks and commercial banks can join the platform through the mBridge MVP legal framework and perform real transactions on it.
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Project expands international cooperation with a new full member and observers.
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More details on Project Agorá—the plan to tokenize correspondent banking | CoinGeek
In April, the Bank for International Settlements (BIS) announced Project Agorá, a project in which seven central banks aim to transform cross-border payments via tokenization.
