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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?


To: benwood who wrote (50502)1/20/2006 7:59:42 PM
From: regli  Respond to of 110194
 
In order to avoid currency risk, most organizations including CBs try to reasonably match their obligations (i.e. contracts) with their reserve basket. Clearly we have seen a distortion of this in the last few years but the Chinese statements indicate that this is the policy that they want to pursue.

The higher the Euro obligations due to an Iranian oil exchange, the fewer dollars will be found in the reserve baskets of Iran's customers.