Dear CIGAs,

This movement away from the Dollar is gaining momentum. It appears to me that we are witnessing the early stages of a global consensus that the Dollar can no longer be the SOLE reserve currency. What many do not seem to realize is that currency risk due to foreign exchange volatility is a huge factor in the profitability of various import and export-related businesses. This is especially exasperating to risk management departments which are forced to conduct trade in a currency not even related to the nation that they are doing business with.

Trader Dan

DJ After China, Brazil Eyes Non-Dlr Trade With India -Estado
06/29/09 08:25

SAO PAULO (Dow Jones)–Brazil is considering using its own currency when conducting trade with India, the local Estado de Sao Paulo newspaper said Monday.

Central Bank President Henrique Meirelles met with Indian banking officials in Europe at the Bank for International Settlements meeting over the weekend to discuss the move away from the dollar in trade between the nations, Estado reported.

Brazil and China are also conducting studies on how to shed the dollar in trade, according to Estado.

A move away from the dollar could eventually do away with currency volatility. Although the dollar is considered the benchmark currency for trade and commodities pricing, many Brazilian companies have lost hundreds of millions over the last two years due to dollar weakness.