The New Global Financial Order
For two decades, China has been transforming its domestic financial architecture into a part of the new international financial architecture, opening the door to a new global order. China's issuance of sovereign bonds in 2024 in Dubai is a significant development. It challenges the narrative that China wants to de-dollarise the world. In its place, it introduces a new order in which the dollar plays a different role. The fact that the U.S. has held the top currency position allowed them to finance their huge deficits despite their poor macroeconomic data, as the world's international reserves are held in U.S. treasury bonds (T-bonds). It has now changed.
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