{"id":38541,"date":"2018-10-01T06:49:25","date_gmt":"2018-10-01T11:49:25","guid":{"rendered":"http:\/\/olduvai.ca\/?p=38541"},"modified":"2018-10-01T06:49:43","modified_gmt":"2018-10-01T11:49:43","slug":"us-dollar-refuses-to-die-as-global-reserve-currency-but-loses-ground","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=38541","title":{"rendered":"US Dollar Refuses to Die as Global Reserve Currency \u2014 But Loses Ground"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"https:\/\/wolfstreet.com\/2018\/09\/30\/us-dollar-global-reserve-currency-hegemony-chinese-rmb-yuan-euro\/\">US Dollar Refuses to Die as Global Reserve Currency \u2014 But Loses Ground<\/a><\/h3>\n<\/header>\n<div class=\"entry-content\">\n<p><strong>Chinese RMB gains, but is inconsequential as central banks remain leery. Euro hangs on.<\/strong><\/p>\n<p>Those who\u2019re eagerly awaiting the end of the \u201cdollar hegemony,\u201d or the end of the dollar as the top global reserve currency, well, they\u2019ll need some patience, because it\u2019s happening at a glacial pace \u2013 according to the IMF\u2019s just released data on the \u201cCurrency Composition of Official Foreign Exchange Reserves\u201d (COFER) for the second quarter 2018.<\/p>\n<p>What it confirms: Global central banks are ever so slowly losing their appetite for being over-exposed to US-dollar-denominated assets, though they\u2019re not dumping them from their foreign exchange reserves; they\u2019re just tweaking them.<\/p>\n<p>They\u2019re not dumping euro-denominated assets either; <em>au contraire.<\/em> But they\u2019re giving up on the Swiss franc. And they remain leery of the Chinese renminbi though they\u2019re starting to dabble in it \u2013 it seems at the expense of the dollar.<\/p>\n<p>In Q2 2018, total global foreign exchange reserves, in all currencies, rose 3.2% year-over-year, to $11.48 trillion, well within the range of the past three years. For reporting purposes, the IMF converts all currency balances into US dollars.<\/p>\n<p>US-dollar-denominated assets among these reserves edged up to $6.55 trillion, but given the overall rise of total foreign exchange reserves, the share of dollar-denominated assets among these reserves edged down to 62.25%, the lowest since the period 2012-2013. In this chart of the dollar\u2019s share of reserve currencies, note its low point in 1991 with a share of 46%. And note the arrival of the euro:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-45028\" src=\"https:\/\/wolfstreet.com\/wp-content\/uploads\/2018\/09\/Global-Reserve-Currencies-USD-share-annual-2018-Q2.png\" alt=\"\" width=\"535\" height=\"400\" \/><\/p>\n<p>The euro became an accounting currency in the financial markets in 1999, thereby replacing the former European Currency Unit (ECU). Euro banknotes and coins appeared on January 1, 2002. At the end of 2001, the dollar\u2019s share of reserve currencies was 71.5%. In 2002, it dropped to 66.5%. By Q2 2018, it was down to 62.25%.<\/p>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<p>&nbsp;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>US Dollar Refuses to Die as Global Reserve Currency \u2014 But Loses Ground Chinese RMB gains, but is inconsequential as central banks remain leery. Euro hangs on. Those who\u2019re eagerly awaiting the end of the \u201cdollar hegemony,\u201d or the end of the dollar as the top global reserve currency, well, they\u2019ll need some patience, because [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2160,280,5844,839,4254,4255],"class_list":["post-38541","post","type-post","status-publish","format-standard","hentry","category-economics","tag-chinese-yuan","tag-euro","tag-global-reserve-currency","tag-us-dollar","tag-wolf-richter","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38541","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=38541"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38541\/revisions"}],"predecessor-version":[{"id":38543,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38541\/revisions\/38543"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=38541"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=38541"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=38541"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}