The share of euros in the world’s rising powers’ reserve holdings has fallen to its lowest level since 2002, dashing hopes that the single currency will soon challenge the US dollar for global primacy.
“There aren’t many places to go in this ‘ugly contest’ if you don’t like the euro, dollar or yen,” said HSBC’s David Bloom.
The effect has been to thwart the Bank of England’s efforts to weaken the pound. The Swiss and UK central banks are effectively in a “low intensity” battle against each other. “This is what happens in currency wars. Desperate times lead to desperate acts,” said Mr Bloom.
Full article: Europe’s dream of toppling dollar fades as Asian Tigers dump euro (The Telegraph)