India and China banks cut dollar exposure

[Trianon]

Together with increased budget deficit and national debt this doesn't look good. Oh, and rising price of oil, coupled with aggression, maybe GWB should start worrying about some near term problems vs SS privatization. FT link

 

[imported_Tango]

After last weeks announcements by South Korea central bank this was in the air. The dollar will probably devaluate to 1.4$ per euro before fourth term 2005.

 

[conjur]

Dollar catching Asian flu
http://www.atimes.com/atimes/Asian_Economy/GC11Dk01.html

SYDNEY - They may be telling a different story to money markets, but Asian central banks have been quietly switching their dollar holdings to regional currencies for at least three years, confirm global banking data. In a further, and so far the biggest, setback for the greenback's status as the undisputed reserve currency, Japan on Thursday said it might diversify its holdings, though monetary chiefs later sought to play down the prospect. South Korea rattled currency traders with a similar announcement late last month, followed by a similar backtrack.

China, India, Thailand, Indonesia, Taiwan, the Philippines and Hong Kong have already started a sell-off, despite a diplomatic show of solidarity for the greenback that is prudently designed to prevent a crisis of confidence in exchange systems. The likelihood is that much of this outflow will never return to US dollars as economic interdependence within East Asia and the widening shadow cast by China's trading conglomerates are slowly transforming the traditional market structure.