© Spiegel Online
Journalist and financial observer Ivan Danilov outlines why Berlin's recent decision on the currency front has to be viewed in the broader context of
a slowly but steady reformatting of the global financial system. On Monday, Bloomberg
confirmed that the
Bundesbank plans to add the Chinese yuan to its currency reserves.
Commenting on the decision in a piece for RIA Novosti, Danilov
noted that
Berlin's move, set against the background of a Yuan riding high against the dollar in currency markets,
is obviously politically charged, "especially when one considers that the entire Western world is now waiting with a sinking feeling for
a diplomatic showdown between Donald Trump and Angela Merkel during the World Economic Forum" in Switzerland later this month.
In fact, the observer suggested, the actions of the Bundesbank, which follow up on the repatriation of at least part of Germany's gold reserves from the US, "indicate that
Europe is ready to show in practice its ability to do without Washington's 'valuable guidance' and 'patronage'."
While the German Central Bank is formally independent, its political ties with the Merkel government aren't really a secret to anyone, according to Danilov. The yuan decision is particularly intriguing given the fact that the Bundesbank usually refrains from announcing its intention to make currency purchases ahead of time. What's more, the journalist wrote, recent developments on the other side of the world indicate that
"Berlin's actions on the currency front need to be analyzed in the context of the broader trend of a slow reformatting of the global monetary system."
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