US Treasury Secretary Timothy Geithner said he was “quite open” to moving toward the International Monetary Fund's Special Drawing Rights Wednesday. Many market watchers read the comments as an endorsement of China's proposal to eventually replace the dollar as the world's reserve currency with SDRs.
But experts told CNBC that even though the dollar may weaken in the coming months, it is unlikely to lose its status as the world’s No. 1 currency for many years to come.
The Single Global Currency Debate
“It is nonsensical to think the world will soon move towards an international reserve currency anytime in the next ten or twenty years,” Ray Attrill, global head of research at Forecast Australia, told CNBC.
Dollar to Lose its Dominance
“The amount of trade that goes on denominated in US dollars will decline over time and those economies in Asia and emerging Europe are going to play a bigger part … that will reduce the dominance of the US dollar,” Chris Loong, head of currency & asset allocation at State Street Global Advisors, told CNBC.
Dollar Decline Coming?
"I don't think the US administration would be all that concerned if the dollar weakened in a gradual way over the next year or so," Ben Pedley from LGT Investment Management told CNBC Thursday, adding that it would aid US exports.
Short Dollar, Long Commodities
Karl Eggerss, chief trader at Frishberg Jordan and Kaleta Advisors, sees inflation down the road as a key concern for investors. He speaks to CNBC about the strategy of being short dollar and long commodities.
Government Stimulus to Boost Commodities
Peter Akerley, president & CEO of Erdene Gold, expects commodities like molybdenum and aggregate to benefit strongly from government infrastructure spending and modernization in China. He also tells CNBC the outlook for gold is positive.
Bumpy Ride for Oil Prices
Expect a bumpy ride ahead for oil prices, predicts Victor Shum, senior principal at Purvin & Gertz. He explains what factors to watch.
Get Used to $50 Oil for 2009
US crude oil should average nearly $50 a barrel in 2009, as OPEC production cuts establish a price floor, according to a Reuters poll Wednesday. Dr. Heliodoro Quintero from the Mercantile Bank of Venezuela considers the outlook for the commodity.