The Russian Central Bank has just announced that it is going to increase its holdings of Euros from 30% to 40% of its total foreign reserves.
So the danger is that if Russia initiates others may follow. A fall in the dollar’s value of say 30% over 3 years would be one thing, but a rapid fall of this kind of magnitude precipitated by a shift in central bank holdings over a limited time horizon would be quite another. This is definitely one to watch.
Just a few short years ago, who would have ever considered it even remotely possible that Russia could have this kind of clout on the world financial markets?
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