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China divesting from the global market, including selling U.S. Treasury securities and increasing gold reserves, could reflect preparations for geopolitical upheaval. Monitoring shifts in their engagement with financial markets is essential, as decreased influence in global finance may indicate a strategic pivot.
7. Shift from SWIFT to SIPS
An emphasis on using China’s own financial messaging system, the Cross-border Interbank Payment System (SIPS), suggests a move away from the global SWIFT system. If China starts demanding businesses to operate through SIPS, it hints at diminishing engagement with Western banks and increasing isolation, typical of a nation anticipating conflict.