Centamin Egypt Ltd
Gold Project: 9.39 Moz Measured and Indicated, Plus 3.5 Moz Inferred
Message: Talk of replacing $US as benchmark at G20
CHINA and other emerging nations back Russia's call for a discussion on how to replace the dollar as the world's primary reserve currency, a senior Russian government source said on Thursday.
Russia has proposed the creation of a new reserve currency, to be issued by international financial institutions, among other measures in the text of its proposals to the April G-20 summit published last Monday.
Calls for a rethink of the dollar's status as world's sole benchmark currency come amid concerns about its long-term value as the US Federal Reserve moved to pump more than a trillion dollars of new cash into the ailing economy late Wednesday.
Russia met representatives of China, India and Brazil ahead of the G-20 finance ministers meeting last week, as the big emerging powers seek to up their influence on decisionmaking globally. Their first ever joint communique did not mention a new currency but the source said the issue was discussed.
'They (China) did not formally put forward their position for the G-20 summit but unofficially they had distributed their paper regarding the same ideas (the need for the new currency),' the source told Reuters, speaking on condition of anonymity.
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The source said the Chinese paper envisaged the International Monetary Fund's (IMF) Special Drawing Rights (SDRs) being first assigned a role of a clearing currency on some transactions and then gradually becoming the main global reserve currency. 'They said that the role of reserve currency should be given to SDR,' the source said. A UN panel of experts is also looking at using expanded SDRs, originally created by the IMF in 1969, but now used mainly as an accounting unit within similar organisations as a new reserve currency instead of the dollar. Currency specialist Avinash Persaud, a member of the UN panel, said at a Reuters Funds Summit on Wednesday that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket. The SDR and the old Ecu are essentially combinations of currencies, weighted to a constituent's economic clout, which can be valued against other currencies and against those inside the basket. -- Reuters |
Comment .: That summit promises to be another very volatile event .The agenda is getiing heavier as the date approaches , some clashes are to be expected. Fears by some to lose the value of their assets ( China ) as well as the impact on the economies and jobs for many participants . 1- Talks about more stimulus 2- Financial rules discussion 3- New monetary benchmark 4-Protectionism discussion We might see accusations flying if things get ugly, that will be a major milestone for the near and distant future. We can expect the price of gold to increase as we get closer to the meeting . Afterwards ( I mean in the following days ) it all depends on the results and the tone of the discussions , if all goes for the best pressure should come down and maybe gold as well but most analyst seems to point towards gold going up . Some here have predicted prices multiplying 2 or 3 folds and even more in a couple of years time. Very interesting for gold investors scary for the rest ,economicaly as well as politicaly.
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