Russian Prime Minister Vladimir Putin annouced this week they are ready to consider using the Chinese and Russian national currencies when doing oil and gas deals with China, instead of the US dollar. They will join Brazil who recently agreed to trade with China in yuan (chinese currency) instead of dollars. Along with the annoucement last month from Iran that they are dumping the dollar to use the euro in their Oil Stabilisation Fund, to “protect itself from the fragilityof the US economy and the weak dollar” according to Iranian state radio.
While we think the US dollar is toast in the long run, there is so much negative news on the dollar coming out all at once that it makes us just a tiny bit suspicious. Regardless, the dollar continues to fall while just about everything else rises. In particular gold, silver and resource based currencies like the Canadian, Australian and New Zealand dollars.