Cashless China

     The total value of cashless transactions in China reached about 16 billion dollars in 2017 and was the highest in the world. Alipay boasts 500 million users, while WeChat Pay may have even 600 million people. The Chinese often use the services of both applications. Together they have over 90%. market share.

 

     For many years, Beijing has been restricting access to its market for foreign competition - Visa or Mastercard. Now, mobile payments are common and Chinese companies have an established position (also the China UnionPay card issuer). Cash payments are becoming problematic. Even the People's Bank of China was concerned, in July it issued a statement that the yuan is an official currency in the PRC and sellers can not refuse to accept cash.

 

    According to the data of the Bank for International Settlements, household debt in relation to GDP increased in China from 17.9%. at the beginning of 2009 to 49.3 percent at the end of the first quarter of 2018. In no other country, the growth rate of household debt was so large. As a result, the statistical Chinese has a higher amount of debt than its annual disposable income.

Russia: Turning point for the currency

       The sanctions turned out to be meaningless?

    The Bank of Russia announced a decision to stop the intervention on the forex market until the end of September. This decision of the regulator has been a turning point for the market, after which the ruble began to strengthen steadily. In addition to reducing the demand for currency as such, the very fact of such a decision had a positive impact on the market, as it demonstrated the Bank of Russia's interest in stabilizing the exchange rate of the national currency.

    The price of Urals oil grew by 7.4% to $73.8 per barrel last week, and is near the maximum for the last four years. The discussion on sanctions is still a minor issue, since the main directions of sanctions are already known, but it will hardly be possible to adopt them in the form of a law until November. However, as the intermediate elections in the US Congress approach, the sanctions pressure on the ruble will increase, as there are no prerequisites for mitigating them.

    In the autumn, the ruble will be affected by the factor of payments for foreign currency-denominated debt. However, the payments by the end of the year will amount to a non-critical amount - $34 billion. Most companies have sufficient currency reserves for debt servicing. Problems with the repayment of debts will not impact the ruble rate, many commentators indicate. 

    As a result of Friday's trading, the dollar rate was fixed near the level of 67 rubles/$.