What we have below are four days of changes this week in many countries foreign exchange reserves (reserve assets) and meetings with changes implemented on monetary policy. The definition of both of these are listed below. If you look closely at the countries listed you will see that most of these countries are on the original list to be re-valued. If we were to look at previous weeks you would see little activity in both of these areas. It is not coincidental this is happening this week. The increase in reserve assets is to become Basel III compliant or simply to shore up the countries currency and create the value needed.
These things are out in the open and yet we do not see this even on the financial news. This would be a precursor to a re-set and needed so the financial system isn’t shocked off it’s axis. We can talk all day about a global re-set but there has to be real world indicators to have this happen.
We have watched today changes of 1%+ in over 45 Currencies. These currencies fluctuate daily and some days we may have up to 10 move more than 1% but today is a record breaker. This also is happening for a good reason as it too is a precursor to the re-set.
Kudos go to Winalot for finding this jewel today. She had to dig to find this one!!
So, we watch and wait as it can’t be long now!
Definition of ‘Monetary Policy’
The actions of a central bank, currency board or other regulatory committee that determine the size and rate of growth of the money supply, which in turn affects interest rates. Monetary policy is maintained through actions such as increasing the interest rate, or changing the amount of money banks need to keep in the vault (bank reserves).
Reserves of SDR, forex and gold in 2006
In a strict sense, foreign-exchange reserves should only include foreign currency deposits and bonds. However, the term in popular usage commonly also adds gold reserves, special drawing rights (SDRs), and International Monetary Fund (IMF) reserve positions. This broader figure is more readily available, but it is more accurately termed official international reserves or international reserves.
Foreign Exchange reserves are called Reserve Assets in the Balance of Payments and are located in under the financial account. Hence, they are usually an important part of the International Investment Position of a country. The reserves are labeled as reserve assets under assets by functional category. In terms of financial assets classifications, the reserve assets can be classified as Gold bullion, Unallocated gold accounts, Special drawing rights, currency, Reserve position in the IMF, interbank position, other transferable deposits, other deposits, debt securities, loans, equity (listed and unlisted), investment fund shares and financial derivatives, such as forward contracts and options. There is no counterpart for reserve assets in liabilities of the International Investment Position. Usually, when the monetary authority of a country has some kind of liability, this will be included in other categories, such as Other Investments. In the Central Bank’s Balance Sheet, foreign exchange reserves are assets, along with domestic credit.