'PM says no substitute for US dollar'
Prime Minister Manmohan Singh said there was no substitute to the US dollar for replacement as the global reserve currency.business Updated: Nov 22, 2009 23:34 IST
Prime Minister Manmohan Singh said on Sunday there was no substitute to the US dollar for replacement as the global reserve currency.
"As far as I can see there is no substitute for the dollar," Manmohan Singh told CNN International television in an interview, coinciding with his trip to the United States.
"My own feeling is that we have not entered an era of irreversible shift in economic strength of the United States," Singh said during the interview.
"Chinese are hesitant from the fact that they own 2.5 trillion dollars of reserve assets. They have not disposed even a fraction of them," Singh added.
China allowed the yuan to rise 21 percent against the dollar between July 2005 and July 2008 before effectively repegging the yuan to help its exporters cope with a slump in global demand.
Beijing now faces mounting international calls to let the yuan, or "renminbi", rise on the grounds that it is undervalued and stoking imbalances with other big economies, but it showed no public sign of budging during last week's visit by U.S. President Barack Obama.
India had said in July that it welcomed discussions on replacement of the dollar, along with China, France and Russia who wanted a debate on the issue.
The dollar rose for a second straight session last Friday as investors cut exposure to risky assets and high-yield currencies ahead of a holiday-shortened week in the United States.