Diary

Dollar Drop in Value Largest in any Month Against the Euro

In U.S. dollar dropped the most ever in one month against the dollar as China ramped up its comments for a new global currency. Bloomberg reports:

June 27 (Bloomberg) — The dollar declined the most against the euro in a month and dropped versus the yen after China repeated its call for a new global currency.

In the understatement of the year, one blue-chip currency trader said:

“The dollar’s status as a reserve currency is being questioned,” said Benedikt Germanier, a foreign-exchange strategist in Stamford, Connecticut at UBS AG, the second- largest currency trader. “There are reasons to sell the dollar.”

Meanwhile, the Brazillian Real has gained (again) against the dollar.

And China and Russia are both concerned about their dollar holdings, according to Bloomberg:

People’s Bank Governor Zhou Xiaochuan urged the IMF that month to expand the functions of its unit of account and move toward a “super-sovereign reserve currency.” Russian President Dmitry Medvedev proposed on June 5 that nations use a mix of regional reserve currencies to reduce reliance on the dollar.

To read more about the dollar’s coming fall, and why the United States is printing money on a massive scale to finance its debts and deficits, click here.