BRICS Building Currency Powers
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The market hasn't realized the significance for the dollar of last weekend's meeting of Brazil, Russia, India, China and South Africa, this analyst says.
When the five countries comprising BRICS got together and agreed to trade among themselves using their own currencies rather than the dollar, it was a "significant move" on the path toward the dollar's losing its current reserve-currency status, says Rudy Martin, an emerging markets analyst at Weiss Research.
"In the old days, with the use of the U.S. currency in the global markets, it was like the U.S. controlled the casino and used their own currency," Martin told CNBC.
But at the meetings last weekend, he said, the five countries "got together and said, 'Look, we're going to set up our own casino'" and start using their own currencies for trade, reserves, and more.
The shift certainly doesn't mean disaster for the dollar is imminent, Martin said.
But over time it could have negative implications for China's holdings of U.S. Treasuries, and that can't be good for the dollar.
You can listen to the whole discussion in the video.
MULTI CURRENCIES v The Dollar
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