Brazil and China Agree to Currency Swap

China is promoting the renminbi as an international tool of finance, and Brazil is the latest country to sign on, reports Joe Leahy for the Financial Times. “The agreement comes amid efforts by Brazil and China to deepen their economic partnership, with Brasília concerned that while it was exporting mostly unprocessed commodities to Asia, it was facing a growing flood of cheap, mostly Chinese, manufactured imports from the region,” he writes. Other countries that have currency agreements with China include Argentina, Japan and Australia. China is Brazil’s largest trade partner, and the US is China’s largest national trade partner. Such transactions can ease trade financing, particularly during a credit crunch. China aims for the renminbi to compete with the dollar as a global currency. The China-Brazil agreement could be the start to more exchanges among the other BRICS nations, also including Russia, India and South Africa. – YaleGlobal