ID | 141700 |
Title Proper | Chinese renminbi arrival in the “tripolar” global monetary regime |
Language | ENG |
Author | Ryan, John |
Summary / Abstract (Note) | Since the financial crisis hit in 2007, the US dollar privilege has not only become “exorbitant” but “extortianate.” Countries such as China are no longer willing to allow the USA to exercise this extortionate behavior. The potential geopolitical implications of a US dollar decline are immense. The USA would lose its privileged seigniorage position and with that the ability to achieve permanently higher returns on foreign assets than the returns paid to foreigners who invest in the USA. The global economy is already close to operating with three regional exchange rate anchors: the US dollar; the euro; and, increasingly, the renminbi. Hence, the transition to a tripolar system could occur sooner than many assert. Nevertheless, given the importance of financial deepening and integration in the internationalization of currencies, any shift will still be gradual. |
`In' analytical Note | China and World Economy Vol. 23, No.6; Nov/Dec 2015: p.44–55 |
Journal Source | China and World Economy 2015-12 23, 6 |
Key Words | Euro ; Dollar ; Internationalization Of Renminbi ; Special Drawing Rights ; Tripolar Currency Regime |