'Yuan To Rise, But Not Enough To Topple Greenback'

Prominent US economist Stephen Roach on Wednesday said the euro and the yuan appear set to make gains as a result of swift reactions to the coronavirus pandemic in China and Europe, though that won’t be enough to shake the dominance of the US dollar as the world’s reserve currency in the foreseeable future.

Roach, a former Morgan Stanley Asia chairman, repeated an earlier prediction that the greenback would depreciate by up to 35 percent in the next few years in the wake of the global economic downturn brought on by the pandemic.

At an online seminar organised by the Our Hong Kong Foundation think tank, Roach also had blunt words for Washington’s diminishing role in the global community.

"Leading the charge against globalization; leading the way in trade protectionism; arguing for decoupling; and then today announcing withdrawing from another global institution – the World Health Organisation for heaven’s sake in the middle of a pandemic – our performance as a global citizen is being drawn into serious question, to say nothing as being a global leader," he said.

Roach also urged Beijing to keep a steady hand on reforms, saying “The last thing China needs to do at this point is to alter its course and move away from the reforms in turns of stimulating internal private consumption and services sector… focusing on indigenous innovation, new ways of urbanization including the Greater Bay Area… All of that is on the books and needs to continue."