China is searching for options to the US greenback as a reserve forex after Western nations froze the overseas belongings of Russia’s central financial institution final week, former IMF chief economist Kenneth Rogoff instructed media on March 1.
The seizure of Russian sovereign belongings has no precedent in postwar historical past, and units a precedent for comparable motion in opposition to China within the occasion of hostilities over Taiwan.
“It is a completely radical measure to attempt to freeze belongings at a serious central financial institution. It is a break-the-glass second,” mentioned Rogoff, now a professor at Harvard College.
“It is a main factor,” Rogoff added. “I imply, if you wish to have a look at the long-run image of greenback dominance within the world financial system, consider me, China’s this. They’ve, I do not know, US$3 trillion in greenback reserves.