In the 10 years of OMFIF’s Global Public Investor, the role of reserve managers has never been so challenging. They are navigating difficult economic and market conditions amid high inflation, weakening global growth and financial stability concerns.
Geopolitical considerations are becoming increasingly important too. Western sanctions on Russian foreign assets may call into question central banks’ control over their international reserves. Tensions between the US and China are adding to the uncertainty over the future of the global monetary system.
Geopolitical tensions were considered the number one factor affecting reserve management in the next five to 10 years and 83% listed it in their top three concerns. Several survey participants mentioned US-China tensions and the possible fragmentation of trade and capital flows as sources of concern. These will probably have a major bearing on their dollar and renminbi holdings in the years to come.
To find out the other pressing considerations and intentions of reserve managers across the macroeconomic environment, asset allocation, currency composition and ESG, click below.
