“A U.N. panel will next week recommend that the world ditch the dollar as its reserve currency in favor of a shared basket of currencies, a member of the panel said on Wednesday, adding to pressure on the dollar,” reports a Reuters story this morning.
“Currency specialist Avinash Persaud, a member of the panel of experts, told a Reuters Funds Summit in Luxembourg that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket. Persaud, chairman of consultants Intelligence Capital and a former currency chief at JPMorgan, said the recommendation would be one of a number delivered to the United Nations on March 25 by the U.N. Commission of Experts on International Financial Reform. ‘It is a good moment to move to a shared reserve currency,’ he said.”
The story comes just a day after the Moscow Times reported that Russian leaders are coming to the G20 summit of world leaders in London on April 2nd prepared to call for moving to a new single common currency. The leaders of Iran, Libya and Kazakhstan have also begun speaking about creating single currencies within their regions — the Middle East, Africa and Central Asia, respectively. The IMF, Asian Development Bank and other international and regional financial institutions in recent years have been studying how to move to a single currency as well. The “Euro” is the model many are looking to, in part because 20% of the world’s foreign exchange reserves are already held in euros.