The best currencies for the investor. What will happen to the dollar (ruble) in the near future - forecasts and expert opinions Why the dollar is increasing
Which country’s currency is the best in the world in 2018? We have prepared a rating of the top 10 best world currencies.
The Russian ruble, unfortunately, is not a role model with a long list of achievements. If we analyze the entire modern historical period of the formation and existence of the ruble, you can easily notice a trend that indicates that the ruble almost always demonstrates indicators of a decrease in its value in relation to the strongest world currencies.
CNY
Until 2005, the currency from the Celestial Empire was tied to the US dollar, but in recent years, the Chinese government has focused on manual and controlled cheapening of its currency to accelerate economic growth.
Nevertheless, even a weakened yuan has risen in price by as much as 228% against the ruble. Since October 2016, the Chinese currency has become the fifth reserve currency of the world, which was approved by the International Monetary Fund.
Israeli shekel
The third place was won by the Israeli shekel. Over the decade, he managed to increase by 216% and demonstrate a floating, but relatively stable exchange rate, which allowed him to stay at approximately the same rates against the dollar that were at the very beginning of the study period.
U.S. dollar
As for the most famous currency in our country and the most used after the ruble, it took only eighth place. The dollar appreciated by 170% and was replaced by currencies, the existence of which most of our fellow citizens do not even suspect.
Schedule. US dollar to ruble exchange rate for 10 years
TOP 10 best currencies in the world ranking
So, let's look at a complete list of the TOP 10 most powerful currencies in the world:
- Swiss franc (237% growth over a decade).
- Chinese yuan (228% growth against the ruble in a decade);
- Israeli shekel (216% growth);
- Bolivian Boliviano (211% growth);
- Singapore dollar (206% growth);
- Brunei dollar (205% increase);
- Thai Baht (196% growth);
- US dollar (170% growth);
- Japanese yen (169% growth);
- UAE Dirham (168% growth).
It is worth noting that the Kuwaiti dinar turned out to be the most expensive currency for ten years, which reached the level of almost 248 rubles per unit. Nevertheless, if we take into account only the growth in percentages, then it amounted to almost 158%, which allowed taking a place in the second ten of the overall classification. Two other currencies popular in the Russian Federation (Euro and British Pound) took 26th and 33rd places, respectively.
The most expensive currencies against the dollar
If you check the dynamics of the exchange rate of all the above currencies, but instead of growth against the ruble, take the indicators against the US dollar, then the Chinese yuan will break out in first place, which has strengthened by as much as 25%.
The Swiss currency will not fall so low and will be in second place with a 20% rate gain. The third place will invariably remain with the Israeli currency, which will show an indicator of 15%.
It is curious that even the Thai currency again showed higher growth dynamics than the US dollar, and overall grew by 9%
Why is the ruble always among the "weak"?
In general, the national currency is nothing more than a reflection of the degree of independence and development of the economy of your country.
At this historical stage, the ruble exchange rate very much depends on the cost of oil, one of the main exporters of which is the Russian Federation
The main method of overcoming this unpleasant situation is to improve, modify and reorient the economy of our country, which will improve not only its performance, but also the overall investment climate of the Russian Federation.
Ultimately, all this will lead not only to greater independence of the country from external factors, but also to the stability of the national currency, which, at least, will not lose value, but at the maximum, will begin to grow, like the currencies of other industry-oriented industries and state economies.
Investments in foreign currency and savings outside banks
Most financial experts are confident that investing in the most powerful foreign currencies to date will not only help to save money, but also bring some profit for a relatively long period (the next decade). Given the current economic crisis, there is no reason to believe that growth will not continue. Moreover, now the dollar is forecasted to increase to 80-90 rubles in the upcoming fall of 2018.
Financiers recommend not to get involved in investments only in the most popular dollar now. It is worth trying to disperse your savings in several areas: the most stable currencies, stocks of companies, precious metals
Relying solely on the US currency is risky due to the fact that even it has certain cycles of growth and fall, which are impossible to predict accurately.
Also, experts advise to partially keep their savings in paper form, because in difficult economic situations it will be much safer.
Where can I buy rare currencies?
Most unpopular, but economically stable currencies can be purchased even at Russian banks. This statement applies to: RMB, Swiss francs, yen, shekels and others. Of course, there will be fewer of them in the presence of a financial institution than the same dollars, but they will certainly be.
The main advice is to contact the real representative offices of banks, and not to obscure exchangers that can deceive you both on the exchange rate and with the currency itself, which may turn out to be fake.
In Russia, the mantra has ceased to work that oil prices keep the dollar afloat. However, this is not so, and the ruble still falls down, despite the infusion into banks, rising oil prices and maximum savings. There are several reasons, but let's take it in order.
1. Why oil is growing
The reason for the rise in oil prices is primarily due to tensions in the Middle East and North Africa, as well as the cartel conspiracy of OPEC. As soon as oil production in Libya and Iraq is restored and oil pipelines are working, oil falls. In addition, if the price of oil exceeds $ 55 per barrel (but for Brend and WTI grades), shale oil production immediately increases and a large excess occurs. Then comes the fall in oil prices to 45, after which the number of drilling rigs in the United States is significantly reduced. Thus, the oil price balance is in the range of $ 45-50 per Brend. However, the bar drops lower and lower. And shale oil is becoming cheaper and the world is undergoing a revolution of green energy and electric transport. In 5-6 years, the cost of oil will not exceed $ 25, experts say.
2. But if oil is now high, why is the ruble dropping?
There are several reasons. First of all, you need to understand that Rosneft is now trying to keep dollars outside of Russia and not pay them to the budget. Many say that "rats are preparing to flee the ship," in anticipation of more serious sanctions and are trying to hide dividends on the side. In addition, Russian petrodollars are immediately invested in other projects that are safe for sanctions. However, for Rosneft, this is not good, but bad. By showing a loss to the budget in Russia, the corporation reduces its market value, and in the event of a decrease in the world oil price, Rosneft may simply go bankrupt and then go under the hammer or dump most of its assets for nothing. We will not talk about what this will lead to for the Russian economy - it is possible to default the state.
The second reason is the complete disaster of the Russian banking system. The fact is that Russian banks cannot be re-credited in the West, and therefore they are gradually bursting. But the Russian government allegedly found a way out - it is recapitalizing problem banks in rubles. This ultimately leads to the fact that the real value of the ruble is one, and the official due to tight control is different. As a result, the currency is washed out of banks (now it is not more than 2-3 billion in accounts in commercial banks). Thus, since 2017, the government of the Russian Federation has already been forced to pump currency into controlled banks, however, it is impossible to calculate with accuracy how much it is needed. Maybe 10, and 15 billion dollars. As a result, more than 70% of the banking sector, which is in manual control, is now under state control in the Russian Federation. And only 30% form free ask for currency.
The third reason is that Russia pays foreign debts, while forgiving debts to a number of "friendly" states. The debts of the "fraternal peoples" of Russia look in the form of deliveries of Russian weapons, materials, loans (in foreign currency), etc. And this money is flowing out of the budget. At the same time, the gap in non-payments significantly widened in 2016-2017 due to the help of various Venezuelans, Syria and the Dnieper.
The fourth reason is the concealment of foreign exchange earnings. Perhaps you noticed that large banks and Russian companies go bankrupt or barely go to zero, but the number of billionaires in the Russian Federation is growing? That's right - a business that is still at least partially independent of Putin and his entourage is trying to bring currency and assets abroad, further from the “Lake cooperative”, under pressure from the state, and also fearing sanctions. And sanctions from the end of 2017 will only increase. There is a tremendous outflow of capital.
3. How dangerous are sanctions for Russia?
Sanctions are the cause of what is happening above. They are gradually squeezing the Russian economy. This is especially true of foreign trade and the financial market. The contraction is such that now the basis of the Russian economy is state-owned companies (more than 60%) and banks. However, they are already hard. There are no loans, and there is especially nowhere to take, the market value of companies is falling, domestic consumption is falling, although taxes are rising. Industrial production collapses. Sanctions are a long game of the West, with the expectation that in 2-3 years the Russian economy will collapse completely.
4. But Russia has friends. China for example - they will help.
Russia has no friends except Zimbabwe, North Korea, Sudan and Cuba. The rest of the countries, including China, are not interested in a serious violation of sanctions, because since November 2017, even companies in third countries may fall under the sanctions. And China has 12 times more trade with the US than with the Russian Federation.
The ruble, according to analysts, will continue to fall, all accelerating. The fact is that the state economy is extremely slow, and there is less and less private business in Russia. Over time, the fall of the ruble will become chaotic and the Russian government will be forced to limit the sale of currency in Russia and completely switch to rubles. And this will lead to an even greater separation from the global economy - the ruble will become non-convertible. When will this happen? The Russian government believes that in mid-2018. Analysts believe that earlier - at the beginning of 2018. The ban on the currency in Russia will lead to the ruble falling to the rate of 1 to 125, and then to 1 to 500, after which, according to some analysts - for example, Stepan Demura, a denomination will occur as under Khrushchev in 1961 , or under Yeltsin. The ruble will be lowered 10 or 100 times. After 60, the ruble will immediately fall to 97, says Stepan Demura.
6. But how to protect yourself?
The question is rhetorical - no way. In Russia, the self-destruction mechanism of the economy was launched back in 2014. The flywheel is huge and it will stop only when the sanctions are lifted. And this will probably not be soon - probably after Putin’s death or its elimination, as well as the elimination of its environment. Also, Ukraine will need to return Crimea, Donbass and withdraw troops from Syria, Transnistria, Abkhazia and North Ossetia. Thus, Russians need to get ready to live for several years under sanctions in a country that will more and more resemble North Korea, with its Juche ideas and staples. At this time, the rest of the world will develop and move forward. For this period you can either leave the country or figure out how to survive with a 50% drop in the economy, censorship and totalitarian governance.
7. So we are tired of changing power?
No - you need to change your mindset. Because if you change your power, but keep “braces”, “rising from your knees”, “international leadership” and “the fight against NATO and their hangers-on”, you will most likely return to the same circle of Russian hell, but already in a smaller territory and with a smaller economy. It is time to abandon imperial politics and develop a nation-state and cooperation.
8. But a nation-state is a rejection of federalism. So many territories will depart - this is the collapse of Russia.
Not. Firstly, these territories will fall off sooner or later. There are no more empires in the world except Russia. Secondly, such a path implies integration into the financial, economic, cultural and social mechanisms of the global market. You can save the best that you have, giving up the worst and unprofitable. A good example is Great Britain, which controlled the sex of the world, but abandoned everything, since it would have lost everything voluntarily or not.
In a nutshell, the explanation is even simpler.Any currency is provided by invested labor. Few people work in Russia, and VERY few invested in labor oil.
Therefore, it’s really not oil that provides the ruble, but DOLLAR! And as those who control the dollar wish, so be it!
Russia is full of dreamers, but VERY FEW realists who know the laws of economics!
https://anatoligreen.dreamwidth.org/1333326.html
For the Russian currency, the time has come for a lull. Despite the pessimistic forecasts of last year, the dollar is trading at 65.59 rubles. Rising oil prices are helping the Russian currency to strengthen, as well as the decision of the US Federal Reserve not to touch the discount rate. However, a precarious balance can at any time be violated by Washington’s new sanctions. In this case, the dollar will jump to 70-72 rubles, experts say.
Despite all the pessimistic forecasts, the Russian currency in 2019 did not fall to the level of 70 rubles per US dollar - the level for the American currency, which experts so eagerly predicted at the end of 2018.
Multidirectional reasons are now affecting currency trading, experts explain.
Of the positive factors for the ruble - rising oil prices. As of Monday, February 4, the price of Brent futures for delivery in April 2019 fluctuates around $ 62-63 per barrel.
In the near future quotes of "black gold" may return to levels of $ 65-75, says Vasily Karpunin, head of the stock market experts department of BCS Broker.
“The continuation of recovery in rising oil prices is possible against the backdrop of a decrease in drilling activity in the United States, a collective reduction in production by OPEC countries, and also due to the approaching end of the period for which an exception is made for buyers of Iranian oil (until May),” the expert says.
Recall that last year, the US administration decided that US sanctions against Iran would not apply to eight countries, allowing them to continue to purchase Iranian oil. Among them are Italy, India, Japan and South Korea.
In addition to the rising oil price, another positive factor for the ruble is the decision of the US Federal Reserve to keep the discount rate at the same level. Last week, the Federal Reserve System Open Market Committee announced that the discount rate would remain at 2.25 to 2.5% per annum.
“The US Federal Reserve has unequivocally pointed to the increased likelihood of terminating the program of targeted increase in the discount rate: now the central bank of the world has promised to focus on really emerging macro statistics, that is, with all other things being equal, high returns on instruments in the dollar zone should not be expected. The Fed’s balance sheet volume will also remain high, and its reduction program will also be put on hold, ”explains Vladimir Rozhankovsky, an expert at the International Financial Center.
According to him, in particular, this increases interest in the assets of emerging markets.
Following the Fed’s decision, the acute risks of global financial markets receded a bit, putting pressure on commodity prices, stock indices and emerging currencies in general, agrees Peter Pushkarev, chief analyst at TeleTrade Group of Companies.
The Federal Reserve’s refusal to aggressively raise interest rates means maintaining relatively inexpensive lending in dollars, which makes it possible to more smoothly develop the situation in the global economy and reduces the risk of collapses and defaults in the markets.
Oil also received support from such changes and could well grow to $ 65 and above, Pushkarev adds.
At the same time, according to Karpunin, it is necessary to remember the budget rule, according to which the Central Bank will continue to buy foreign currency in the open market.
In 2019, the regulator resumed buying foreign currency for the Ministry of Finance on the open market, interrupted in August this year due to increased volatility of the ruble against the backdrop of the threat of new sanctions. Until February 6, the regulator sends 265.8 billion rubles for these purposes. In February, the Central Bank will also start making deferred purchases.
“There will be more operations, the higher oil prices go up. Such a mechanism reduces the potential volatility of the ruble due to fluctuations in oil prices, ”says Karpunin.
Although the domestic currency made attempts to strengthen last week, it has not been able to maintain its position so far, says Andrey Lyushin, deputy chairman of the board of Loko Bank ..
The most likely scenario at the moment seems to be a decrease in the value of the Russian currency to 65.8 rubles per dollar, says Mikhail Mashchenko, an analyst with social networks for eToro investors in Russia and the CIS. At the same time, if there are no reasons for optimism, then by the end of March the exchange rate may drop to the level of 66.5 rubles for the American currency, he adds.
Whenever the word "currency" is used, dollar or euro banknotes pop up in our view. But currency is nothing but money, that is, a medium of exchange used by all peoples in various transactions between individuals or enterprises.
Once upon a time, this universal medium of exchange did not exist; or it was just beginning to manifest itself in one form or another. Then trade relations between individuals and entire countries was carried out through barter. In a barter exchange system, an individual or business had to directly exchange their goods and services. Such trading was carried out on the basis of trust and mutual understanding, as well as in the presence of a third party agent, that is, an intermediary. With the advent of money, everything changed, since they, already as a currency, assumed the functions of an intermediary and a trusted participant in the transaction.
Today in the world there are a large number of national currencies, but the degree of confidence in them varies. Therefore, ratings of the most trusted (reliable) and valuable (expensive) are regularly compiled. Like, for example, ours:
1. Kuwaiti Dinar - KWD
Both the exchange rate, currently the highest against the US dollar, and the prosperity of the economy due to large-scale oil production have made Kuwait's currency the most important person in the world of money. The Kuwaiti dinar is pegged to the dollar and costs $ 3.65. Despite the fact that this currency is extremely stable, reliable and so expensive, it is far from the popularity of the American dollar in the financial trading market. At Forex, the Kuwaiti dinar is most often converted into Indian rupee. The currency code is KWD.
2. Bahraini dinar - BHD
Bahrain is one of the most financially prosperous countries, so it is not surprising that its dinar is one of the most secure means of payment in the world. Conversion of 1 BHD to US dollars by the beginning of 2015 was carried out at an average rate of $ 2.65. It is for this reason that many hired foreign workers prefer to work in Bahrain. Bahrain's index of economic freedom is highest in the Middle East and North Africa. Moreover, this country ranks tenth among the free economies of the world. The currency code is BHD.
3. US Dollar - USD
Approximately 85% of transactions in the Forex market and financial exchanges around the world are conducted with the American dollar. It is used as a national currency and by some other states, for example, El Salvador. As a reserve currency it is used in very many countries, in some it has circulation along with national money, and in some places, as a means of daily household payments among the population, it has completely replaced them. US official policy promotes the wide circulation of dollars in the world and declares their reliability. All banknotes and coins, starting from the 1861 issue, are accepted by US banks for exchange without restrictions (although the security of the dollar with a gold reserve has already been canceled). The currency code is USD, the symbol is $.
4. Australian dollar - AUD
In addition to Australia and its external territories, which are members of the Australian Union, has circulation in the independent island states of Kiribati, Nauru and Tuvalu. The Australian dollar has long been among the most traded currencies in the world (4 - 5 places). This is due to the fact that Australia is a large state with a developed economy, which, which is very significant, due to its isolation, is less prone to crisis in the global economy than other countries. Among dealers and brokers of the foreign exchange market, the name “Aussie” (Aussie) has been assigned to Australian money.
The currency code is AUD. Character A $ or $ (domestic). In Asian ratings and quotes, other designations are sometimes found: AU $ and $ AU.
5. Pound Sterling - GBP
The British pound is very widely known as the official currency of the United Kingdom of Great Britain and Northern Ireland, as well as all its overseas territories (former colonies). It is 100 pence.
Pound sterling is really a very "weighty" currency: 1 GBP is converted into more than two US dollars. Such a course can be disadvantageous for tourists visiting England, but from the point of view of investments and investments it is one of the main “heavyweights” in the financial markets. The currency code is GBP, the symbol is £ (Libra).
6. Japanese Yen - JPY
Japanese money currently occupies the 6th place in the ratings of the most stable currencies in the world. About 20 percent of daily transactions in the international currency market are related to the yen. This word means "round object" in Japanese. The spelling and pronunciation of "yen" became so thanks to native English speakers who visited old Japan, and the original sound of the word ゑ ん is somewhat different. The currency code is JPY, the symbol in quotations is ¥.
7. Canadian dollar - CAD
This year, the Canadian dollar on average has a share in daily foreign exchange transactions in the world of 5.3%. Until the beginning of the 19th century, a number of different currencies were in circulation in Canada at once: English, French, as well as several local ones. In the years leading up to the Confederation, most of the country was organized as small rural settlements scattered over a large area; therefore, it was more convenient to carry out banking activities not as a single, but divided territorially. Gradually, a single national unit of account gained more and more respect. A significant increase in the influence of Canadian money occurred recently - in the spring of 2014. Canada now ranks 11th in the world in terms of the size of its economy. The currency code is CAD.
8. Hong Kong Dollar - HKD
The currency circulating in Hong Kong. She became the eighth of the most traded currencies in 2014, the same level can be assigned to it in terms of reliability. The Hong Kong dollar, like all others, consists of 100 cents. It has the designations 圓 (in the formal Cantonese dialect) and 蚊 (in the colloquial Cantonese dialect). Sometimes the name 元 is used for it. The currency code in international quotes is HKD.
9. Cayman Islands Dollar - KYD
It is currently the official monetary unit of this small state. It also has the abbreviation C / $. There is no direct taxation in the Cayman Islands and the islands thrive as an offshore financial center. This is indeed one of the most valuable currencies: 1 KYD is about $ 1.20. In addition, this is the most expensive currency among all the dollars (and in the world many countries called their money that way). The currency code is KYD.
10. Swiss franc - CHF
This is the currency of Switzerland, as well as Liechtenstein. Unofficially, it is also the currency of the Italian enclave of Campione d'Italy and the German exclave Buzingen. This is the last kind of franc still circulating in Europe. The value of this money is more than the US dollar, since 1 CHF is approximately $ 1.10; and its stability and stability have become the talk of the town.
The head of Sberbank German Gref told in which currencies it is better to store savings. And this is not an American dollar. The most reliable Sberbank recognized the Swiss franc, Norwegian and Swedish crowns. The main world currency - the dollar - was only in ninth place in the ranking, barely surpassing the ruble.
The most reliable world currencies Sberbank President German Gref called the Swiss franc, Norwegian and Swedish kroner. He refers to the results of a study of his organization. The main reserve currency in the world - the dollar - Sberbank experts put only in ninth place in the rating of currency stability. And the ruble is in 11th place.
“Reliability and stability of the currency is one indicator, and its reserve status is another”
But, as the head of the Ministry of Economic Development Alexei Ulyukaev correctly recalled, the reliability and stability of the currency is one indicator, and its reserve status is another.
What is the stability
Switzerland, Norway and Sweden have something that the United States does not have, and vice versa. In the first three countries, currencies are least affected by devaluation, their rate is stable and predictable. The governments of these countries have a sound macroeconomic policy, and, of course, they have enough resources to maintain the stability of their currencies. In addition, they have the highest level of liquidity in the world, said Gref.Take the Swiss franc. Since the 20s of the last century, the Swiss currency is 40% backed by gold and currency reserves. At the same time, the dollar and franc cost almost one to one. The Swiss franc showed the highest liquidity (according to Gref), which amounts to $ 80 billion daily. This means that there is constant supply and demand for the Swiss franc. Liquid currency can be exchanged at any time for another currency.
The Swiss franc is stable. The Swiss National Bank is really fighting to ensure that there is no strong devaluation. In fact, such an event was noted only in 1936 during the Great Depression. And, for example, when in 2009 the EU faced serious debt problems, the franc did not devalue, but rather began to grow against the euro, because there were no debt problems in Switzerland. The authorities did not like it anyway, and in 2011 the Swiss bank assured that from that moment it would not allow its currency to be strengthened to more than 1.2 francs per euro. This is the real strength of the currency. Let mortgage, debt or other problems happen in the USA, Europe or elsewhere, nothing to the Swiss franc. Your five kopecks in Swiss francs will remain five kopecks when converting to your native currency, even after the bankruptcy of the next Lehman Brothers.
The monetary policy of Norway and Sweden is also aimed at maintaining the solvency of their own currencies, and the macroeconomics of these countries are among the most stable and, very importantly, self-sufficient. While Switzerland has the ability to maintain a stable exchange rate at the expense of a strong banking sector and gold and foreign exchange reserves, Norway - at the expense of a practically inexhaustible reserve fund, which was accumulated thanks to the export of oil and gas. And Sweden is a recognized safe haven in Europe, which has retained its currency by joining the EU and has a reliable banking system.
The US dollar, unlike the above currencies, is constantly devaluing, and the Federal Reserve does not have the obsessive goal of maintaining dollar stability. Since 1913, the dollar depreciated dozens of times, and over 80 years, the American currency has undergone sharp exchange rate changes twice: in 1933 and in the 70s of the last century, says Andrei Kochetkov, an analyst at the Otkrytie Brokerage House. There can be no talk about any stability of the dollar, which means that it is a risk to keep their savings in them. Therefore, the ninth place in Gref’s ranking is the most logical place for the dollar.
But the ruble took 11th place in the rating of Sberbank is not quite right, at least for the moment. Now the Russian currency is clearly not enough stability for such a high place. It’s just that Sberbank, when making the rating, took into account past periods when the ruble exchange rate was tightly regulated. But now the Central Bank of the Russian Federation has begun active liberalization of exchange rate formation, that is, Russia does not have a goal to maintain the ruble exchange rate, as, for example, in Switzerland.
“Since 1999, the ruble has weakened slightly against the dollar. For a long time, it even strengthened to major currencies, when emerging markets were popular in world finance. However, the macroeconomic situation in the Russian Federation is far from complete well-being, and 11th place is still an attempt to pass off wishful thinking. Only in 2013, the ruble threw to around 30 per dollar, and then weakened to 33 rubles per dollar, ”Andrei Kochetkov points out.
In light of the current policy of the Bank of Russia, further ruble depreciation is expected. There should not be sharp jumps, but a smooth devaluation clearly does not add stability to the currency.
There is no contradiction
There is no contradiction in the fact that the dollar is in ninth place in the rating of Sberbank and at the same time is the main reserve currency of the world. “The US dollar has risks that the Fed will pour out excess debt liquidity to the consumer market and exchanges, which will cause inflation and depreciation of the currency. And the title of reserve currency is confirmed by the fact that the bulk of exchange trading and import-export operations in the world are carried out in American currency, ”says Dmitry Lukashov, an analyst with IFC markets.“Having an impressive US debt burden helps keep its currency reserve”
As FxPro financial analyst Alexander Kuptsykevich points out, about two-thirds of commodity circulation, as well as about 80% of foreign exchange transactions, are in US dollars.
More than 60% of all gold and foreign exchange reserves of the world are in US dollars. It is risky to keep all savings in US dollars due to an unstable exchange rate. But in the reserves - not really. Therefore, large capitals are denominated in dollars, but they are not stored in them, but are placed in dollar assets. And, of course, the US economy is the largest in the world, and competing in this indicator with the economies of Switzerland, Norway or Sweden is simply ridiculous. The struggle for economic leadership in the United States is only with China.
“This means that the bond markets of Switzerland, Norway, Sweden are very modest and simply can not meet the needs of the world in relation to foreign exchange reserves. It is very important that the country's debt markets are wide and deep, as this allows you to build up and reduce reserves in this currency without a serious impact on quotes. States provide such a market. To a lesser extent, it is provided by Japan and large countries of the eurozone (Germany, France, Italy). What makes these currencies the most popular as Central Bank reserves. Such a paradox: the presence of an impressive debt burden of the state contributes to the fact that its currency is a reserve one, ”Kuptsykevich explains.
There are no alternatives yet
Economists and scientists have been debating for a long time about what currency will replace the dollar as an international reserve currency. The head of the Ministry of Economic Development of the Russian Federation Alexei Ulyukaev on Wednesday also expressed the opinion that in the near future the dollar will remain the key reserve currency. “From my humble point of view, we are not moving towards greater multi-currency, but towards greater mono-currency. And in the near future, the dollar capacity of the market, the development of this financial market creates greater prospects for reserve for it than for other respected, wonderful currencies, ”said Ulyukaev, speaking at the Gaidar Forum.There is no alternative to the dollar. Euro, yen, Swiss franc and pound sterling are now also used as reserve currencies, but they are not ready to replace the dollar yet. The eurozone is in crisis, while Japan, the UK and Switzerland have too small economies compared to the United States.
The Chinese economy is catching up with the US in size, but the Central Bank of China has an inflexible monetary policy. “The Chinese economy ranks second in the world, but the country relies heavily on the dollar in terms of payment for goods and services. The Chinese are moving towards liberalization of the course, but are only at the beginning of this path, ”says Alexander Kuptsichevich.