Foreign central banks have not been dumping US-dollar-denominated assets. But they’ve been loading up on assets in other currencies, and their total holdings of foreign exchange reserves have ballooned, while their USD-assets have remained nearly flat for over 10 years. So the share of USD-denominated exchange reserves dropped to 56.8% of total foreign exchange reserves in Q4, the lowest since 1994, according to the IMF’s data on Currency Composition of Official Foreign Exchange Reserves, released on Friday. It has been zigzagging down toward the 50% line for years. It does have consequences. And it has been there ... (full story)