From today’s VoxEU article, by Robert N. McCauley with Hiro Ito and Menzie Chinn:
Will the freezing of foreign exchange reserves of the Bank of Russia undermine the central role of the dollar in the official foreign exchange areas? This column examines the cumulative evidence from the end of 2021 for any reduction in the dollar share of official foreign exchange funds compared to a baseline constructed with data from 1999 to 2021. The observed dollar share in March 2024 differs little from the out-of-sample forecast. based on this premise. In this show, official reserve managers have not reduced the role of the dollar since the freezing of assets of the Central Bank of Russia.
Main graph (Figure 1 from the article):
Source: IMF Cofer; authors calculations.
Note: The projection uses a 2021Q4 dollar share of 58.8%, a constant of -.121 and a valuation change impact coefficient of .735. where the latter two are estimated quarterly changes in the dollar share over the 91 quarters 1999Q2-2021Q4.
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