The monetary order in the world is changing. The global trade and currency markets are slowly and steadily coming into the one where they are becoming less dollar-centric. Chinese Yuan, which was a marginal currency, has now started the race to become a competitor to the dominance of US dollar.
This changing scenario led the market experts to figure out if gold can also begin to emerge as a leading currency in the world trade. Well, over the time, it may emerge out as that. However, the implications are that gold is being accumulated by central banks such as China’s.
Chinese Yuan is expected to enter the list of top-tier currencies in the upcoming month of October. It will then share the platform with the U.S. dollar, British pound, euro, and Japanese yen. China is basically promoting the SDR to let the Yuan reach on heights and also to diminish the effect of U.S. dollar in global reserves.
Obviously the king of currencies, Dollar cannot be dethroned overnight. The place of dollar is very eminent on global basis and market experts are expecting the same in case of gold. Gold is one metal which is equally valued amongst all nations around the world and it can definitely challenge the dominance of U.S. dollar and establish itself as a global currency. China and Russia have mutual interests to work in the direction of reducing the impact, power and position of U.S. dollar. These two economies are also engaging themselves in trade deals that can bypass the dollar. The annual trade ration between these two countries is also increasing.
These mutual interests can ultimately result in the favor of gold. If the dominance of gold goes down, gold can certainly emerge as the new power.
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