The disrespect for the dollar has now escalated to the next level. The disgrace this time comes from none other than Israel. The Israeli Central Bank indicated that it would make significant modifications to its foreign reserves, including the acquirement of the Chinese yuan with a significant decline in the country’s holdings of US dollars.
The bank will add the Chinese yuan, with three other major currencies, to a stockpile that surpassed $200 billion for the first time in history last year. As a result, the yuan, or renminbi (RMB), is now one of Israel’s four foreign reserve currencies, alongside the Dollar, the British Pound, and the Euro.
The adoption of the Yuan will signify a change in the Bank of Israel’s entire investment standards and attitude, according to Deputy Governor Andrew Abir. The shift in Israeli financial philosophy is intended to reduce the country’s reliance on the dollar. This in no way implies that Israel is warming up to China. It’s only because Israel has realized that relying on the dollar in foreign reserves may not be as helpful to them, as it used to be.
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Preparations for this Philosophical Shift
Israel’s adjustment in asset allocation gets it closer in line with the rest of the world, although it’s yet to invest in the Swiss franc,......
