How far will it fall this time?After finding more gold than has been recorded to date, how low will gold sink?
President Vladimir Putin said that the BRICS countries – Brazil, Russia, India, China, and South Africa – are currently working on setting up a new global reserve currency.
“The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,” the member states are also developing reliable alternative mechanisms for international payments.
Why is this happening? The dollar has long been seen as the world's reserve currency, but its dominance in share of international currency reserves is waning. Central banks are looking to diversify their holdings into currencies like the yuan, as well as into non-traditional areas like the the Swedish krona and the South Korean won, according to the International Monetary Fund.
"This is a move to address the perceived US-hegemony of the IMF," ING's global head of markets Chris Turner said in a note.
It will allow BRICS to build their own sphere of influence and unit of currency within that sphere.
