Foreign-exchange reserve managers at central banks around the globe expect the dollar to remain dominant for at least another quarter-century.<\/p>\n
Roughly 66% of managers believe the greenback will remain the reserve currency of choice over the next 25 years, according to a UBS Asset Management survey of 30 central banks. The US currency accounts for about 62% of global central banks\u2019 $11.7 trillion foreign-exchange reserves, the International Monetary Fund said last month.<\/p>\n
The finding comes as questions emerge over the state of the so-called strong dollar policy and countries like Russia vocally diversify out of the greenback.<\/p>\n
Bank of England Governor Mark Carney railed against the dollar\u2019s hegemony in August, bemoaning the currency\u2019s \u201cdomineering influence\u201d on trade. But still, the dollar is \u201cthe ultimate safe-haven currency,\u201d according to UBS.<\/p>\n
\u201cThe dominance of the US dollar in global reserves – an average share above 60% over the last 25 years – has been a constant feature of FX reserve management,\u201d UBS analysts Massimiliano Castelli and Philipp Salman wrote in a report released Wednesday.<\/p>\n
\u201cThis is particularly surprising because speculations about the imminent demise of the dollar have become a stable refrain over the past decades.\u201d<\/p>\n
The Chinese yuan is expected to chip away at the dollar\u2019s share, however.<\/p>\n
UBS found that 38% of respondents see it becoming a reserve currency on the level of the dollar or the euro in the quarter-century to come. The euro accounted for just over 20% of reserves in the second quarter, according to IMF data.<\/p>\n
Other findings in the survey:<\/p>\n