Israel will buy riskier assets for its reserves after adding China's yuan and cutting dollar holdings in its biggest portfolio reshuffle in a decade
Israel's central bankis adding more equitiesand high-yield corporate bonds to its portfolio.
- "We have a broader set of currencies, and we're also going into a broader set of instruments," Governor Amir Yaron said Thursday.
"We have a broader set of currencies, and we're also going into a broader set of instruments," Yaron said Thursday in an interview with Bloomberg. "It's part of our way of enhancing the overall return on these reserves as we're looking at the medium-run outlook for the return on our investments."
The shift into more equities and riskier assets is part of the bank's biggest portfolio reshuffle in a decade and an evolving investment "philosophy."
Before, the bank only held US dollars, euros, and the British pound. But in April, it slashed its dollar and euro holdings while adding the yuan, as well as the Canadian and Australian currencies and the Japanese yen. The changes come as Israel aims to lengthen its investment horizon and generate greater returns on its roughly $200 billion foreign-exchange stockpiles.
"We need to look at the need to earn a return on the reserves that will cover the costs of the liability," Deputy Governor of the
Now, about 2% of the bank's reserves are allocated to the yuan, and the Canadian and Australian currencies will have about 3.5% each, according to the bank's annual report. The euro's share dipped from 30% to 20%, and the
The International Monetary Fund reported earlier this year that the dollar's share of total global
But experts say the global economy would have to simultaneously lose faith in the dollar while gaining trust in China's monetary policy for any significant change to global reserve to occur.
"Challenges to the dollar have come before, but none have taken hold because when things turn volatile, the US tends to be stable, so the dollar persists," economist Aleksandar Tomic previously told Insider.
- Survey shows people find no improvement in public toilets across country
- Sebi extends deadline for listed cos to confirm or deny market rumours
- Tom Hanks, a dental plan promotion and an AI
- New 'inverse vaccine' shows potential to treat multiple sclerosis, diabetes: Study
- TDP leaders stage hunger strike In Delhi against arrest of Chandrababu Naidu