Central bank currency riggers buy dollars sold by central bank investment arms

By Gertrude Chavez-Dreyfuss
Reuters
Monday, March 31, 2008

NEW YORK -- Global central banks' currency reserves rose at the end of the fourth quarter, while the dollar's share of these holdings edged up despite claims of steady diversification away from dollar assets.

Data from the International Monetary Fund released on Monday, which covers about two-thirds of the world's foreign exchange reserves, showed that currency holdings rose to $6.391 trillion in the fourth quarter, up around 6 percent from the previous three months. Total allocated reserves also increased to $4.065 trillion.

Dollar reserves were at a record $2.6 trillion, or 63.9 percent of the total allocated reserves, up marginally from 63.8 percent in the previous quarter, but down from 65.4 percent a year earlier.