Reserve managers see politics shaping currency allocations

Euro loses traction as reserve currency, as dollar confidence grows

Asset allocation decisions made by central bank reserve managers are being driven by political uncertainty, resulting in a significant change in currency holdings.

Central Banking’s latest Reserve Management Trends survey saw the US dollar regain popularity among central bank reserve managers, with the euro and sterling losing favour due to the implications of Brexit and uncertainty surrounding upcoming elections in eurozone countries.

The survey received responses from 80 central banks, colle