(Adds details on currency holdings)
WASHINGTON Dec 30 The U.S. dollar's share of
currency reserves reported to the International Monetary Fund
slipped in the third quarter of 2016 to its lowest level in two
years, data from the IMF showed on Friday.
The July-September period was the third consecutive decline
in the dollar's share of allocated currency reserves, or those
reported to the IMF. The decline could reflect increased
optimism about the global economy, with the European economy
seen on improved footing.
In the third quarter, the dollar comprised 63.3 percent of
allocated reserves, the smallest share since the third quarter
of 2014. The dollar made up 63.8 percent of allocated reserves
in the second quarter.
The euro's share rose to 20.3 percent in the same period
from 20.0 percent the quarter before, while the yen's share
increases to 4.5 percent from 4.4 percent.
The dollar's value has surged since Donald Trump's victory
in the Nov. 8 U.S. election, which led investors to expect U.S.
inflation will accelerate.
IMF data also showed that total foreign exchange reserves
worldwide rose to $11.01 trillion from $10.97 trillion in the
second quarter. The total amount of allocated currency holdings
also rose, to $7.80 trillion, from $7.50 trillion previously.
Unallocated reserves, or those that have not been reported
to the IMF, slid to $3.21 trillion from $3.47 trillion in the
second quarter. It is widely believed in the currency market
that part of China's reserves are in the unallocated pool.
China began reporting in the second quarter of 2015 a
representative portfolio on a partial basis and will gradually
increase to full coverage of its foreign exchange reserve assets
within two to three years, according to the IMF.
Friday's data will be the last quarterly report not to
separately identify China's share of global reserve allocations.
China's holdings will be broken out for the first time with the
fourth quarter IMF report due in March 2017.
The Australian and Canadian dollars, which have recently
been included in the reserves composition, had shares of about 2
For the full breakdown of the data, click here
(Reporting by Jason Lange; Editing by W Simon and Meredith