3 Jul 2013
Flash: Less liquid currencies make way to portfolios – UBS
FXstreet.com (New York) - “New Zealand's Finance Minister English has long suggested that several Asian central banks hold kiwi bonds, and have been steadily accumulating more – bond ownership data supports this too.” suggests Research Analyst Gareth Berry at UBS.
Commendably, the Swiss National Bank provides an inventory of the less-liquid currencies it holds, namely: "AUD, SEK, DKK, SGD, KRW, plus small holdings in additional currencies in the equity portfolios." Other central banks may have followed similar diversification paths too.
According to Berry, “Growing reserve diversification into these smaller currencies helps explain why the recent rise. If this process continues, the IMF may one day 'promote' some of these residual currencies too, giving them categories of their own in the quarterly COFER data - just like the Australian and Canadian dollars now.”
Commendably, the Swiss National Bank provides an inventory of the less-liquid currencies it holds, namely: "AUD, SEK, DKK, SGD, KRW, plus small holdings in additional currencies in the equity portfolios." Other central banks may have followed similar diversification paths too.
According to Berry, “Growing reserve diversification into these smaller currencies helps explain why the recent rise. If this process continues, the IMF may one day 'promote' some of these residual currencies too, giving them categories of their own in the quarterly COFER data - just like the Australian and Canadian dollars now.”