INSUBCONTINENT EXCLUSIVE:
2020, according to a recent survey by the International Monetary Fund (IMF)
Findings of the IMF's Currency Composition of Official Foreign Exchange Reserves (COFER) survey say this partly reflects declining role of
US dollar in global economy in the face of competition from other currencies used by central banks for international transactions.If the
shifts in central bank reserves are large enough, they can affect currency and bond markets, said Serkan Arslanalp, Deputy Division Chief in
balance of payments division of IMF's statistics department, and economist Chima Simpson-Bell
The share of US dollar assets in central bank reserves dropped by 12 percentage points -- from 71 to 59 per cent -- since the euro was
launched in 1999, they said in a blogpost posted on IMF's website.Meanwhile, the share of the euro has fluctuated around 20 per cent while
the share of other currencies including Australian dollar, Canadian dollar and Chinese renminbi climbed to 9 per cent in the fourth quarter
However, the fact that value of US dollar has been broadly unchanged while its share of global reserves has declined indicates that central
banks have indeed been shifting gradually away.Some expect that US dollar's share of global reserves will continue to fall as emerging
market and developing economy central banks seek further diversification of currency composition of their reserves
A few countries like Russia have already announced their intention to do so.Despite major structural shifts in international monetary system
over the past six decades, US dollar remains the dominant international reserve currency
Any changes to its status are likely to emerge in the long run.
