Friday, January 28, 2005

If China Shuns Dollar, Look Out U.S. Bonds: William Pesek Jr. - Bloomberg

Bloomberg Printer-Friendly Page

"Jan. 28 (Bloomberg) -- Malaysia isn't a place traders look for clues about the U.S. dollar, yet Asia's No. 10 economy may be offering some ominous ones.

They can be found in a recent report on international reserve holdings at Bank Negara Malaysia, the nation's central bank. It states that Malaysia made a $2.1 billion ``revaluation gain'' in 2004, ``arising mainly from the depreciation of the U.S. dollar against the major currencies.''

Central banks are always reticent to detail their holdings, but one can't help but wonder if Malaysia is buying an increasingly amount of euros -- or even yen -- these days. Its central bank sure didn't make that kind of cash holding the dollar, the currency to which its own, the ringgit, is pegged."

Malaysia becomes the first country to dump the dollar...