Tumultuous times for the dollar this week. Gold has hit an all-time high three days in a row (this morning it’s at $1,045 troy ounce – it was only $990 on 29 September) while WTI oil is up at $71.50 a barrel todaycompared to $66 just over a week ago – both commodities head upwards when the greenback’s going the other way. So what was going on? Over to the NYT for the stocks and bonds report in Wednesday’s paper:
Investors clamored to buy pretty much anything on Tuesday — as long as it was not the dollar. A seven-month slide in the value of the dollar gained force as investors migrated to other markets and fretted over a report that crude oil could one day be priced in other currencies, hobbling the dollar’s role as a vehicle for global trade.
Whatever would give investors that idea, you wonder? Answer:
A report on Tuesday in The Independent, a British newspaper, suggested that China, France, Japan and Russia were in secret talks with Persian Gulf countries to abandon the dollar for international trade in oil and replace it with a basket of currencies and gold.
The Independent? Not the FT, not the WSJ, but the Independent? Yup, the FT’s Alphaville blog says so too:
The Independent appears to have rocked the world on Tuesday with its Robert Fisk exclusive exposing a secret plot by international central banks to topple the US dollar.
So what on earth did he say that managed to move markets on the other side of the Atlantic?