Global companies are starting to borrow in Chinese currency instead of dollars because it is far cheaper, which is bad news for the US bond market and the dollar's grip on world finance.

• Swiss bank UBS raised money inside China at under 2% interest, a fraction of what it would pay in dollars, and demand was three times what it offered.
• Bond sales in Chinese currency by foreign firms are up sharply this year, and more European banks are expected to follow.
• Chinese borrowing costs sit near 1.7% while US ten-year rates are near 4.7% — every deal that skips the dollar chips away at demand for Treasuries.
• The Fed has signaled rate cuts are off the table until inflation is under control, so US borrowing will stay expensive.
• Washington's threat to squeeze Iran by sanctioning Chinese banks looks hollow: cutting off China's banks would break US companies' ability to move money in and out of China.

Outlook: Expect more Western banks and companies to raise money in China, adding steady pressure on the dollar and on the Treasury's efforts to keep the US bond market calm.