Investing in the Chinese Yuan: World's Reserve Currency by 2030?
Brian Foglia submits:Reuters reports that MIT economist Simon Johnson has predicted the Chinese yuan will replace the dollar as the world’s reserve currency within the next twenty years. He added that the US will see its dominance ebb during this period. China’s rise as a global power is virtually undisputed, and no one seriously doubts that China will one day eclipse the US as the world’s most important economy. While this news may sadden us as citizens, it should motivate us as investors. The bullish case for the yuan is very strong. For years, the Chinese government has kept its currency pegged to the US dollar in order to make Chinese goods less expensive for American consumers. In order to maintain the artificial exchange rate and prevent the yuan from appreciating, the Chinese central bank continuously purchases dollars.Complete Story »