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Reuters
JP Morgan gives advice of gold that was preceded by Russia years ago
US bank JP Morgan has recommended investors to move away from the dollar and increase their investments in gold and other major currencies, which Russia has known and applied for years.
The US bank said in a note to the markets that the US currency was losing its position as the dominant currency of the global economy and wrote: "There is no indication that dollar dominance will remain forever."
"The dominant currencies have changed many times over the course of history, just like the world's economic center," the US bank said, blaming the dollar's decline on China's emerging role as an economic powerhouse.
"China is no longer just a low-cost manufacturer," said Craig Cohen, JP Morgan commodity price badyst, "Chinese companies are starting to take advantage of value-added economic sectors such as technology."
"We believe that the global economy in the coming decades will shift from the dominance of the US dollar to a system where Asia is stronger," he said, which means that the dollar will likely lose his place.
Cohen pointed out that recent data on central bank reserves around the world have revealed that they are beginning to diversify further and further from the dollar, where the pace of gold buying, pointing out that gold has enjoyed a place of trust for thousands of years.
He said the current economic climate shows the importance of diversifying financial badets to include other major currencies and gold.
It should be noted that Russia has been using for years to diversify its international reserves, where the share of the dollar has contracted in the face of the rise of the yuan, the euro and the euro. gold, whose reserves of 2207 tons were recently ranked fifth among the world's precious metals reserves.
Source: agencies
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