The number of central banks seeking to increase their exposure to the US dollar has increased sharply this year, according to a closely watched annual survey, confounding calls from some developing countries to use rival currencies as reserves.
A net 18 per cent of global central banks plan to increase their allocation to the dollar over the next one to two years in response to US interest rates remaining high, according to the Official Monetary and Financial Institutions Forum, a UK think-tank, which surveyed 73 such institutions managing a total of $5.4tn of international reserves. The move marks a sharp rise from a net 6 per cent a year ago.
At the same time, demand for the renminbi has stalled among central banks, halting a trend of recent years when more central banks had aimed to add exposure to the Chinese currency.