Barron's: Central Banks Are Tilting Away From the Dollar. What They're Buying Instead.
Article by Karishma Vanjani in Barron's
International central banks are charting a move away from the dollar, but because there is no single alternative for the U.S. currency, they plan to buy up euros, China’s yuan, and more gold.
That is the takeaway from a report published Wednesday morning by the Official Monetary and Financial Institutions Forum, known as OMFIF. The results are based on discussions with 10 central banks, who manage about $6.5 trillion in total.
The conversations, held between July and September, offer a candid view of what the banks are doing with their money.
A European reserve manager was quoted as saying “we are moving from a bipolar to a multipolar reserve system, but the euro is not ready yet to lead.” An interview with an emerging-market central bank found that it is looking to allocate 10% to 15% of its reserves to domestically mined gold.
While the dollar remains the anchor of global reserves, trust in U.S. policy has weakened. That is leading to a slow but deliberate move into other assets, the report said. Gold .....